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September 12, 2019 12:52 PM

New tire plants on tap in Europe, Asia, America

Bruce Davis
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    AKRON—Even as capital spending by the world's tire makers on new plants and capacity expansions slows, and some tire plant projects have been suspended, the industry will grow measurably this year as five new plants announced in the past few years either have come on stream or are set to before year-end.

    These projects collectively represent $3.8 billion in capital spending and more than 12 million units of new production capacity, according to Rubber & Plastics News' calculations.

    At the same time, two high-profile new tire factory projects in the U.S. valued at over $630 million—Balkrishna Industries Ltd.'s and Qingdao Sentury Tire Group's—have been put on indefinite hold.

    New plants brought on stream thus far this year include:

    • Continental A.G.'s $265 million car and light truck tire plant in Rayong, Thailand, started production in March on schedule, two years after the company broke ground on the project. The plant is designed to produce up to 4 million tires per year for Thailand and the Asia Pacific region by 2022, Continental said, with up to 900 employees at full production.

    The facility is Conti's sixth tire plant in the Asia/Pacific region and 20th worldwide.

    • Nexen Tire Corp.'s $1 billion manufacturing complex in Zatec, Czech Republic, began trial production in April and was ceremoniously commissioned Aug. 28. The 7 million-sq.-ft. Zatec factory is rated at 3 million units of capacity at start-up, and is expected to increase to 11 million by 2022.

    The factory is one of four key investments Nexen has made of late to strengthen its global presence. The others are the Nexen univerCITY Central Research Institute in Seoul, South Korea, the European R&D Center in Kelkheim, Germany, and the North America R&D Center in Richfield, Ohio.

    Scheduled to come online later in 2019 are:

    • Goodyear's $77 million "Mercury" flexible-production passenger tire plant in Colmar-Berg, Luxembourg.

    The plant, built in close proximity to Goodyear's existing Luxembourg innovation center and tire proving grounds, is engineered to use "additive manufacturing technologies" to produce premium tires in small-batch quantities on-demand. Rated capacity at start-up is 500,000 units a year with about 70 full-time employees.

    "Mercury addresses the increasing complexity in the tire industry as the number of vehicle models and options available to consumers continues to proliferate," Richard Kramer, Goodyear chairman CEO and president, said at the plant's groundbreaking in September 2017.

    "It gives us the capability to increase our speed and flexibility to meet the growing demand for small volumes of high-margin, premium Goodyear tires and to deliver them to customers on demand, faster than ever."

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    • Continental Tire the Americas' $1.4 billion car and truck tire plant near Clinton, Miss.

    The plant is projected to produce 750,000 truck and bus tires annually in the first phase, starting with 400 employees. Trial production is scheduled to start in October with commercial-scale production ramping up in early 2020.

    Full projected employment of 2,500 won't be reached until 2028.

    Conti got a jump-start on production earlier this year by training workers at a training facility opened at the site. The center is equipped with classrooms, computer labs and technical equipment, which will be used for job interviews, new employee orientation, and training.

    Continental also entered into a partnership with Hinds Community College in nearby Raymond, Miss., to drive employment and professional development at the facility.

    • Nokian Tyres P.L.C.'s $360 million car and light truck tire plant near Dayton, Tenn.

    Trial production at the 860,000-sq.-ft. factory began in June with about 70 employees on staff, with full-scale commercial production set to start in October. The company anticipates full employment will be about 400 at the plant when it hits its projected nameplate capacity of 4 million tires a year in 2023.

    The facility will include a warehouse designed to store 600,000 tires and will feature an administration building—which will house meeting spaces, offices, a gym, etc.—that Nokian said is intended to reinforce the Nordic company's "life-driven culture" while providing everything its employees need to be successful.

    • A PT Gajah Tunggal Tbk./Inoue Rubber Co. Ltd. motorcycle tire joint venture plant in Tangerang, Indonesia.

    The venture, Gajah Tunggal IRC Manufacturing Indonesia, will produce IRC-brand high-performance motorcycle tires for the Indonesian OEM and replacement markets as well as exports, Gajah Tunggal said.

    Off-highway tire specialist BKT announced in early August it was suspending its plans for a U.S. tire factory, citing business uncertainties related to difficult macroeconomics and volatile climate conditions.

    BKT had announced plans in October 2018 to build a $100 million plant in the U.S. to help it accelerate its business with North American equipment makers.

    China's Sentury Tire earlier this year put on hold indefinitely plans for its U.S. plant, which was to be built in Troup County, Ga. Sentury had announced plans in September 2016 for a plant with a projected annual capacity of 12 million car/light truck tires and up to 1,000 jobs.

    Sentury originally had projected the plant would be operating by 2018 but as of early this year only minor site preparation work has been carried out, local sources indicated.

    Another U.S. project—Triangle Tire USA Inc.'s $580 million factory complex in rural North Carolina—is still being pursued, but it doesn't appear the company has been able to stick to its original timetable of having the plant completed by April 2020.

    The last official statement pertaining to the plant was in September 2018 when the company said heavy storms associated with Hurricane Florence did not affect ground-clearing efforts at the site near Rocky Mount, N.C.

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