A total of $954 million is being invested in the Chinese plant; it will break ground early next year and it is set for completion by the end of 2015.
When finished, the facility will produce 11.5 million car, truck and bus tires, generating annual sales of $1 billion. It will also create about 4,600 new jobs in the region.
“With the establishment of Hankook Tire’s global sixth plant, Hankook Tire has taken another step towards our goal to strengthen our global foothold and to become a leading global tire company,” says Seung Hwa Suh, vice chairman and CEO.
“We will continue to seek for future investment opportunities in order to improve our production capacity and productivity, and will also show our commitment to the local communities,” he adds.
The company currently has five production facilities – two in Korea (Geumsan and Daejeon), two in China (Jiaxing and Jiangsu), and one in Hungary (Rácalmás). They have been operating at 100 percent capacity since the third quarter of last year. They have a total production capacity of 87 million units per year. With the additional sixth plant, capacity is expected to increase to 100 million units per year.
Hankook has been maintaining its place as the seventh- largest tire company since 2006, achieving an annual sales growth rate of 13.9 percent over the past decade, according to Suh.
Construction of the Hungarian plant’s second phase started in September 2009. It reach its full capacity by the second half of 2011 – which will more than double its current output, manufacturing up to 12 million tires each year.
As demand “has been growing steadily and dynamically around the world, particularly in Europe,” the company invested an additional EUR 230 million in the Hungarian site, amounting to a total of EUR 550 million.
Hankook Tire Hungary is also hiring 700 new employees.
Investments are being made for the education of the next generation’s rubber professionals to meet the needs for skilled workers in collaboration with the Hungarian Labour Office, which offers an accredited tire manufacturing training course. Upon completion the students will automatically be qualified to be hired by Hankook.
“Thanks to the expanding investment in our ultra-modern factory in Hungary, we can satisfy our customers in the growing European market by setting the highest quality standards,” says Suh.
“We are glad that the construction and preparations for the new production unit are on track, allowing us to commence our operations sooner than scheduled,” he reports.
In response to the increasing demand for winter tires this season and an overall shortfall for these products in the market, the new unit is currently focused on manufacturing winter and all-season tires. The Hankook Optimo 4S will also be produced at the site.
Due to the growing demand from its original equipment and replacement market in Europe as well as around the world, the new plant will play a future key role in Hankook’s business strategy, especially regarding production of ultra-high performance tires for cars along with light truck tires, according to Suh.
For more information visit www.hankooktire.com.
