CLINTON, Miss.—Continental Tire the Americas broke ground in Clinton last November on its $1.4 billion commercial tire plant, but the first tires aren't expected to roll off the production line for more than 2½ years.
Between now and then, that leaves a lot of work to be done. Site clearing began in September 2016, plant construction won't begin until 2018 and the first tire is scheduled to be manufactured in December 2019.
"We've got this project in two phases because it's such a big site," Grant Bovim, Continental's project manager for the plant, said of the 1,000-acre plot the factory will be built on.
The first part is to develop the site, he said, with the second phase being construction of the facility. "It's really about the execution," Bovim said. "We have a plan now, what we want to do with the site. Then it's just to get all the team members together and make sure we meet our deadline within the right budget."
Starting from 'Square Zero'
Being able to construct a tire factory from scratch is a big advantage rather than trying to expand an existing site.
The Continental official joined the firm in 1988 as a young training engineer. From there, he became a project engineer and then moved into manufacturing. The South African native then became production manager for the plant in Port Elizabeth, South Africa.
That plant is a good example of what happens with older facilities. "It was an older plant and it almost grows like a mushroom," Bovim said. "The flow is not always the correct flow."
That's the top benefit of starting new. "You get the flow of the material going in one side of the plant and the tires coming out the other side," he said.
It also helps to have everything new, according to Bovim. All the machinery is the same, and newer facilities tend to be more energy efficient, which helps bring down long-term production costs.
Continental also got a site with a clean slate, as the government and the Mississippi Development Authority took care of several obstacles during the two-year negotiating period. Those challenges included: relocation of 270 marked and unmarked burial plots; transfer of land from an education trust to Continental, in exchange for land the company donated to the school system; and mitigation of wetlands issues.
"All the local issues were handled by the MDA," Bovim said. "We took ownership of the site in late September. The MDA handed over what we called a clean site."
Time to move dirt
Plant sites typically are flat, but that wasn't the case in Clinton, bringing a longer timeline to get from groundbreaking to tire production. The site has undulations and a 45-foot drop from North to South, according to the Conti executive.
"Normally when we get a site it would be flat and we'd be ready to start (installing foundation) pilings a month after groundbreaking," he said. "Here we need to move 4 million cubic yards of dirt. The plan is to start piling in October."
While tire manufacturing is still farther down the horizon, the firm already is looking toward training needs. Continental has met with Hinds County Community College, Bovim said, to work with them to ensure that training requirements are tailored to the needs of the tire industry. The firm at a later stage also will work with several state universities.
Construction of the training center, in fact, will begin this July just outside the fence line of the tire production campus, Bovim said. "That's an important part of the project. We want it completed by July 2018 so we can already be using it to onboard our people and start training before we start installation of machinery,"
Looking ahead to production
Production during the first phase will be scaled to meet market requirements, with Bovim himself slated to transition to plant manager. "When you run the project, you become the plant manager so you make sure you build it correctly and you staff it correctly," he said.
Construction activities are expected to be finished by the end of 2021, with employment at the time projected at about 2,500, the company said. Conti can expand the scope of the facility beyond truck/bus tires if needed.
Several dealer customers who attended groundbreaking ceremonies are encouraged by Conti's vision for the site.
Bryan Ahern said Conti is the biggest supplier for his family's Cassidy Tire & Service chain that has 15 locations in the Chicago area, with business split evenly between commercial and passenger. "It's exciting to see them move up," Ahern said. "It's become the tire of choice and people are asking for the product, on the passenger side and especially now on the commercial side."
Continental is the largest truck tire vendor for McMahon's Best One Tire & Auto Care, which has five locations based out of Fort Wayne. They are affiliated with the Best One group, which boasts about 250 locations.
"Building these plants shows that they're here in America to stay," said Bubba McMahon III. "You can say it's made in America, and that's a huge selling point to a lot of people."
His wife, Kim, said they've been selling Conti tires for years, but business has grown substantially in recent years. "They're trying to make a move and become a bigger part of the market, and we think that's great," she said. "Our business with Continental has gone through the roof in the last five or six years."
Redburn Tire Co. in Phoenix has been a General Tire dealer since 1934 and became a Continental customer when the German firm bought General. Corporate Sales Manager Dave Richards agreed that building the plant in the U.S. sends a strong message. "I think it's really good they're investing in the states," he said. "They could have gone anywhere in the world."
Richards said Conti has made strides in the last decade to become a cradle-to-grave supplier for commercial tires.
"I'm impressed by their knowledge," he said. "Technically they're a very sound group. I think they push hard for that. If you have tire questions, Continental is going to answer for you, and I like that part of it."