Taiwan Manufacturers Expanding Tyre Production in China

Taiwan`s three-largest tyre manufacturers, including Cheng Shin Rubber Industry Co., Hwa Fong Rubber Industry Co. and Kenda Rubber Industrial Co., are reported to be planning to increase investment in their facilities in mainland China.

Cheng Shin will invest between US$50 million and US$60 million to expand the production capacity of its Kunshan, Jiangsu province plant between now and the end of June 2009. Once completed, the expansion will see daily production capacity at the plant rise to 54,000 passenger car tyres from the present level of 45,000, making the facility the largest tyre plant in China. The company also noted it would invest between US$60 million and US$70 million to expand production capacity at its plant in Haiyen plant in Xiamen, Fujian Province. Daily output would be boosted from the current level of 4,000 passenger car and truck tyres up to 6,000. Expansion in production at these two facilities is anticipated to help Cheng Shin increase its annual sales by a total of NT$15 billion (US$496 million).

Hwa Fong said it has invested a further US$54 million in its Suzhou plant in Jiangsu province during the past few years, and adds that such investment will continue. The company’s Suzhou plant focuses on the production of passenger car tyres that are exported to North America, Europe and Southeast Asia. Thanks to the introduction of a number of new products, Hwa Fong’s Suzhou plant is expected to see annual production value jump to US$40 million this year from US$10 million last year.

Kenda said it has set aside US$3.6 million to set up new production lines for bicycle and motorcycle tyres in its Tianjin plant. Its motorcycle tire production line is anticipated to commence volume production sometime in 2009. In addition, the company will further set aside US$6.4 million to establish a new plant in Tianjin in the second half of 2008.