Kumho Breaks Ground at New China Site
The groundbreaking ceremony for Kumho Tires’ fourth factory in China – and the first not to be engaged in the manufacture of passenger car tyres – was held in Nanjing on May 16 in the presence of more than three hundred company executives and distinguished guests. The company will invest around £50 million in the construction of this latest facility, which when completed in the second half of 2008 will specialise in the production of truck and bus radials. Annual production is planned at 300,000 units.
At the ceremony, Kumho chief executive Park SamKu stated “I am very glad to build this bus and truck tyre factory at Nanjing, an important place for us to further our growth in the Chinese market.” He added that Kumho intends to place a greater emphasis on dealings between the company’s Korean headquarters and its operations in China. Furthermore, Kumho Tires is planning, in the company’s own words, to “aggressively pursue the Chinese tyre market through an export markets diversification strategy.”
With the Chinese vehicle market growing at around 10 per cent each year and tipped to continue for some time, Kumho have stated their intention of intensively expanding in the Chinese domestic market, both in the OE and replacement tyre segments. In February Kim Chang Nyun, general manager of Kumho (China) Sales was quoted as saying “by 2008, Kumho wants to capture at least 20 per cent of China’s retail and OEM tyre market respectively. We want to become the top tyre producer by production capacity in China.”
By the end of next year, following the Nanjing facility’s entry into production, Kumho will have an estimated annual production rate of 64 million tyres, divided amongst its Chinese factories, one in Vietnam and the company’s three facilities in Korea.