Sailun to increase all-steel truck tire capacity in Cambodia

SVAY RIENG, Cambodia—Sailun Group has disclosed plans to add capacity for all-steel radial truck tires at the passenger tire plant it opened last year in Cambodia.

Sailun is budgeting $220 million for the project, which is considered part of the company's efforts to expand outside of China.

The new plant, to be built at the company's existing facility in the Qilu Special Economic Zone in Svay Rieng city, in southeastern Cambodia, will have the capacity to produce 1.65 million radial truck/bus tires per year, Sailun said.

The project is expected to be completed in 17 months and is specifically targeting the European and North American markets, the company said.

The tire maker started up production of semi-steel tires in Cambodia last November with a daily output of 8,000 units. At full capacity, the plant will be rated at 9 million car tires a year.

In its latest feasibility study, Sailun said the Cambodian location would offer it an "abundance of labor," low-cost natural rubber as well as preferential import and export tariffs.

The project, to be operated by Sailun's Cart Tire subsidiary, is expected to achieve an average annual operating income of over $250 million.

The Cambodia facility is Sailun's second overseas production unit, after Vietnam, which started operation in 2013 and is undergoing a project to increase annual capacity to 13 million passenger tires, 2.4 million truck/bus tires and well as 85,000 metric tons of off-road tires.

Sailun Tire Americas, a Sailun Group subsidiary in Brampton, Ontario, oversees distribution of the Sailun brand in North America. TBC Corp. is the brand's designated distributor in the U.S.