WEIFANG, China—Shandong Haohua Tire Co. Ltd. has disclosed plans to invest $450 million to build a radial car and truck/bus tire plant in Sri Lanka and to expand truck/bus tire capacity at a factory in Weifang.
Shandong Haohua, which goes to market under the Aplus, Compasal, Lanvigator and Royal Black brand names, is budgeting $200 million to build a plant in Sri Lanka with an expected annual capacity of 20 million units. The remaining $250 million will be used to expand TBR capacity in China.
Phase one of the Sri Lanka plant project foresees an annual capacity of 3 million truck and bus tires a year, the company told European Rubber Journal. The remaining 17 million units of annual capacity will be designated for high-performance passenger tires.
Phase One is budgeted at $200 million. The plant will be located at a site on Sri Lanka's coast southeast of Colombo, the nation's capital.
The project was scheduled to break ground earlier this year, Haohua said, but was delayed due to the coronavirus pandemic. Construction of the project will take 18 months.
Headquartered in Weifang, Haohua also plans to add 3 million units of annual truck/bus tire production capacity at a factory in Weihang's Shouguang county.
This plant is one of three factories Haohua operates in China. Together, they represent annual capacities of 5 million truck/bus tires and 20 million car tires.
The Shouguang County plant expansion was slated to ramp up starting in mid-2020, the company said, but it was postponed on account of uncertainty in market conditions and insufficient manpower.
The company manufactures more than 700 tire products. In 2019, it reported sales revenue of $866 million and valued its exports at $500 million. The company was ranked No. 23 on the 2019 Rubber & Plastics News Global Tire Report ranking of the Top 75 tire makers with fiscal 2018 sales of $1.37 billion.