Jiangsu GST breaks ground on plant expansion in Thailand

SHANGHAI—Jiangsu General Science Technology Co. Ltd. has officially launched a previously announced expansion project to increase production capacity at its tire manufacturing plant in Rayong, Thailand.

The Chinese manufacturer held a groundbreaking ceremony at the site on Sept. 27 for the $260 million (Yuan 1.9 billion) program to nearly double the production of high-performance radial tires at the facility.

The project will add 500,000 all-steel truck/bus radial (TBR) tires and 6 million passenger car radial tires to the annual capacity, the company said in an Oct. 7 statement.

Operational since 2020, the operation run by subsidiary General Rubber (Thailand) currently has capacity to produce 1 million TBR tires and 6 million passenger car tires.

The construction period for the expansion project is expected to take 24 months, according to a previous announcement by the group in August.

Once completed, the project is expected to increase average annual operating income by about $290 million and average annual net profit by $51 million, said General Science in its latest announcement.

The expansion is also expected to create 1,500 new jobs, it added.

Part of the group's internationalization strategy, the move aims to utilize Thailand's "superior rubber resource advantages, mature tire manufacturing industry chain and economic policies with international advantages."

According to the group, the Thai factory has reached agreements with "many leading customers in North America, Europe and Southeast Asia" for the supply of "high-quality products."

According to Li Kai, deputy general manager of General Science Thailand, the first phase of the factory project has reached full production with both sales and orders "exceeding demand" in the first half of 2023.

"Recently, the factory's orders have exceeded production capacity by more than 50 percent, and it is imperative to expand the second phase of the project," he added.

The factory also offers benefits such as reduced anti-dumping rates by the U.S. for tires originating from Thailand. Coupled with the increase in overseas market demand and the decline in raw material prices and shipping prices, the expansion is expected to deliver "outstanding" advantages.

The Thai factory is part of General Science's "5X strategic plan," which aims to expand the group's reach overseas.

Earlier this year, the Chinese tire maker officially inaugurated its production facility in the southwestern Cambodian province of Sihanouk, while announcing plans for a new Yuan 1.5 billion greenfield plant in Baotou, Inner Mongolia.

The company also operates a headquarters production facility in Wuxi City, Jiangsu, where it has the capacity to produce 10 million units of TBR tires pear year.