Q4 production start for Hankook’s Indonesian factory

Upon visiting Hankook Tire’s global website, one of the first things to be seen is a positions vacant advertisement for PT. Hankook Tire Indonesia’s new factory in West Java, indicating that a start to production lies just around the corner. A senior Hankook manager has now confirmed to local media that commercial operations at the Lippo Cikarang plant will begin in the last quarter of 2012 with a workforce of around 1,200.

The Jakarta Post reports that Yong Seop Hyon, the plant management team’s senior manager, as saying 82 per cent of construction work at the facility had been completed by June 2012. An investment of US$353 million is required for this first development stage. “Upon the completion of this plant, we will immediately continue to the next stages of the facility’s development,” he told media representatives during a press conference in West Java.

Initially the plant will produce around 30,000 tyres, which are allocated for export to the US, Hankook’s regional marketing and sales vice-president Jae Bum Park said, adding that exports would begin at the end of this year. Park said output would reach four million units in 2013 and six million upon reaching full first phase operating capacity in 2014; at this point Hankook will have a global capacity of 100 million tyres a year and be the world’s fifth largest tyre maker, he added. Total investment in all five stages of the plant’s development is expected to reach $1.1 billion by 2018, and at this time Hankook hopes to produces 16 million tyres a year in Indonesia.

“Indonesia will become our production hub for North America and the Middle East and other neighbouring countries,” said Park, adding that Hankook would allocate ten per cent of its output to the domestic market – a market that, along with other ASEAN countries, grew 32.8 per cent in the past year.

The Jakarta Post’s reportage of Hankook’s press conference in Indonesia also states that PT. Hankook Tire Indonesia will invest around $5 million in the “Hankook Masters” brand over the next to years and build up its national sales network to 100 outlets.