Hankook has broken ground on a new plant in
Indonesia. As the company's seventh global tire
factory, the $353 million initial investment will
comprise four major production facilities covering
6.4 million square feet.
It will act as an export base for North America and
the Middle East, as well as a regional business hub
for emerging Asian markets.
“This year, we have seen incredible growth and
increased demand for our high quality tires in the
U.S. market,” says Soo Il Lee, president of Hankook
Tire America Corp. “The additional production
capacity that the new Indonesia plant is going to
provide will mean greater tire availability,
increased sales and market share and continued
positive growth for us in the United
States.”
The company posted a first quarter sales increase
of more than 26 percent from 2010’s first quarter
figures. It has targeted more than $1 billion in
U.S. sales for this year.
The choice of Indonesia “is a promising plant
location” as it is one of the main rubber producers
in the world with a total production of 2.92
million tons in 2010, according to Lee.
“Tire demand and production in Indonesia continues
to soar,” he reports, with Indonesia, Thailand,
Malaysia and Vietnam collectively supplying 95
percent of the world’s rubber. In 2010, Indonesia’s
tire exports increased by 25 percent over 2009;
tire sales rose 23 percent. Hankook’s’s investment
in Indonesia is expected to grow the country’s
national tire industry by 10 percent to 15
percent.
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Initial production capacity of the new plant will
be about 6 million tires per year. It will employ
some 1,400 workers by 2014 and is expected to add
2,800 additional jobs by 2018.
More than half of the output will be dedicated to
the U.S. market. Hankook’s projected 2011 worldwide
production capacity is estimated at more than 89
million tires, with its annual global production
capability expected to reach 100 million units by
2014, Lee says.
In May the company broke ground on its third plant
in China, encompassing more than 5.7 million square
feet. It will start operations by August of 2012,
amounting to a $954 million investment to produce
truck, bus and car tires. Completion is anticipated
by the end of 2015 with a production capacity of
11.5 million tires per year; 1.6 million of them
will be truck and bus tires.
Hankook’s investment in the new factories is part
of its goal to produce 100 million tires a year by
2014 and become the world’s fifth-largest tire
company, according to Lee.
For more information, visit www.hankooktireusa.com.
