Home Away From Home

Less than a year after a ground-breaking ceremony was held at the Dunaujvaros Industrial park in central Hungary, Hankook Tire celebrated the official commencement of production at its first European factory. To mark this momentous occasion the very first tyre, an Optimo K715, made its way through the 56 hectare plant’s assembly and vulcanisation facilities, and upon completion a small ceremony was held in which this first tyre was signed by the company’s global CEO Seung Hwa Suh, the Hungarian Minister of Economy and Transport Janos Koka together with Eom Seock Jeong, the Korean Ambassador to Hungary.

“We are very glad to be welcomed by the Hungarian government, by the people of Dunaujvaros and the whole region”, said Mr. Suh. “From the start of this project in late 2005 to the production of our first tyre made by Europeans for Europeans, Hankook Tire has been in the safe and reliable hands of our Hungarian partners. We owe a debt of gratitude to the support we have received from both the Hungarian government and from the warm and generous welcome of the people of Dunaujvaros to everyone from the Hankook Tire family.”

Dunaujvaros was chosen as the site for the company’s first factory on the continent due to a number of factors, including reliable government and business partners, established infrastructure and the ready availability of highly educated and qualified manpower. Hungary’s central location in relation to the main target export markets of northern, western and central Europe also played a decisive role in the choice of site. Hankook state that the plant will shorten delivery times in Europe from the month required for tyres to arrive from Asia down to between one and seven days.

“When the facility is fully completed we plan to have created employment for up to 1,500 people, and stimulated further economic growth throughout the region,” said Suh. “Hand-in-hand, Hankook Tire will grow with Hungary as the Dunaujvaros facility helps strengthen our reputation for producing superior quality and high performance tyres.” At present 810 people are employed at the Dunaujvaros plant, and of these some 350 received between three and six months’ prior training in Korea. Initial plant production is focusing upon the Optimo K415 and Optimo K715, both high performance passenger car tyres, however the facility will in the near future be responsible for the manufacture of both passenger car and light truck tyres including the RA08, supplied as OE for the Ford Transit.

Production at Dunaujvaros is expected to reach five million units per annum next year and ten million by 2010, by which time Hankook anticipates a doubling of European market share and a Europe-wide increase in the number of dealers participating in the Hankook Masters Program – it is hoped 300 dealers will be on board in 2010 compared to the current figure of 45.

“The importance of this facility for Hankook Tire’s future journey cannot be understated,” added Mr. Suh. “European sales in the first quarter this year grew by 23 per cent, and by the time the facility is completed we plan to have doubled our European market share from 4 per cent to 8 per cent. Dunaujvaros’s strategic location in the heart of Europe will help capitalise on the growing demand from European customers for our products. The new facility will give a strong boost to our competitiveness by slashing logistical costs and improving our customer service.”

Hankook has maintained a physical presence in Europe since the establishment of its European Technical Center in Langenhagen, Germany a decade ago, and today the company controls its operations throughout the region from its German headquarters, with offices or subsidiaries also operating in a further eight European countries. The Korean tyremaker has made no secret of its desire to become a leading brand name throughout the region: earlier in the year Hankook stated that it considers Europe their “second domestic market,” and in June the company confirmed that it aims to become recognised as the “home” tyre brand in Hungary.

Concluding his speech to those assembled to mark the June 26 plant opening, CEO Suh neatly summed up Hankook’s aspirations for their new venture: “I thank you all for joining us today in what is an historic moment for Dunaujvaros and Hankook Tire, and I look forward to seeing our friendship bear fruit as our journey continues over the coming years.”