Sailun investing in 8th tyre factory

On 24 June 2022 Sailun decided to invest 15.18 billion yuan in building a new tyre factory in Dongjiakou, West Coast New District, Qingdao City, Shandong Province. The planned annual production capacity is 20 million sets of semi-steel radial tyres, 10 million sets of all-steel radial tyres and 150,000 tons of OTR tyres. At present, the Sailun board of directors has passed this investment proposal.

Sailun will establish a wholly owned subsidiary in Dongjiakou to operate the new factory project. It is reported that the new plant will adopt intelligent production and testing equipment, and the products manufactured are high-performance green tyres. According to the plan, the Dongjiakou factory’s construction will start in November 2022 and be completed in October 2027, which will take five years.

Sailun will raise the investment of 15.18 billion yuan through it own funds and loans from financial institutions. The tyre manufacturer said that the project funds would be invested in five phases. According to Sailun’s calculations, after the Dongjiakou project is put into production, this factory can achieve an annual turnover of 21.9 billion yuan and an average annual net profit of about 2.961 billion yuan.

Currently, Sailun already has a tyre factory in Huangdao District, Qingdao, and the Dongjiakou production base will be the tyre company’s second factory in Qingdao. The Dongjiakou production base will be Sailun’s eighth factory overall. The other seven factories are located in China (Qingdao, Dongying, Shenyang, Weifang), Vietnam, and Cambodia, with a planned annual production capacity of 16.6 million all-steel radial tyres, 68 million semi-steel radial tyres, and 160,000 tons of OTR tyres.

If the Dongjiakou base can be successfully put into operation in 2027, the production capacity of Sailun is expected to reach 26.6 million all-steel radial tyres, 88 million semi-steel radial tyres, and 310,000 tons of OTR tyres.