SANTA ANA, Calif.—The share of Yokohama Tire Corp.'s tires for sale in North America that are sourced from offshore is rising, but that likely will shift back once the firm begins truck and bus tire production at the factory under construction in Mississippi.
A little more than half of the tires currently are produced domestically, from its plant in Salem, Va., along with its share of the GTY Tire Co. joint venture it shares with Continental Tires the Americas L.L.C. in Mount Vernon, Ill., said Jeremy Kahrs, senior director of supply chain, logistics and corporate planning for Yokohama Corp. of North America.
Foreign tires shipped for sale in North America come from different plants in Japan, the Philippines, Thailand and even a small quantity from Vietnam. The uptick in foreign sourcing mainly is because a large percentage of tires from the Philippines facility are shipped into the U.S.
“We made a large investment in the Philippines a couple of years ago and have an ongoing expansion there, so the Philippines plant is on the path from ramping up from 7 million units a year a couple of years ago and will eventually be 17 million,” he said.
But Yokohama expects to begin making tires at its West Point, Miss., plant later this year, so the pendulum should start going back toward domestic output, Kahrs said. The first phase is for truck/bus production, but he added that Yokohama has said all along that it intends to have multiple future phases that could bring more commercial output and possibly consumer tire manufacturing, depending on market needs.
“We have to look at global growth because our factories supply Yokohama globally,” Kahrs said. “In order to coordinate that global capacity and decide where to invest in additional capacity, that requires global coordination.”
For 2014, North America accounted for $535.6 million of Yokohama Rubber Co. Ltd.'s $5.91 billion in sales, according to the parent company's annual report.