PIROT, Serbia (April 3, 2012)—Michelin is planning a $227 million investment over five years in its Tigar Tyres d.o.o. subsidiary to expand annual capacity at Tigar's plant in Pirot 50 percent to 12 million tires.
The 77-year-old plant, which Michelin bought into in 2005, produces entry-level tires sold under the Tigar, Kormoran and Riken brands. Michelin said most of the tires produced will supply fast-growing markets in Russia, Central and Eastern Europe, Africa and the Middle East.
Michelin said this investment is in line with its strategy to strengthen its presence in the entry-level market segment, which it projects will grow 30 percent worldwide in the coming 10 years.
The project will boost annual capacity to 12 million tires by year-end 2016 from 8 million currently, Michelin said, and create 700 jobs at the plant where 1,900 are now employed.
Work on the expansion is expected to begin in early 2013 with production from the expanded plant starting by mid-2015, Michelin said.
Michelin did not say whether the project entails a physical expansion of the factory, nor did the French tire maker say what, if any, financial or logistical support Serbia is providing.