Triangle Tyre publishes details of USA car, truck tyre factory plans
In disclosures to the Shanghai Stock Exchange, Triangle Tyre Co., Ltd. reports its intention to invest US$580 million in what the company calls its “America Factory Project”. The investment will cover the cost of erecting facilities for producing both passenger car and commercial vehicle tyres.
The first phase of the project will involve an investment of approximately $298 million and centre on the construction of a plant equipped to manufacture 5 million passenger car, ultra-high performance, SUV and light truck tyres per annum. Design and construction work is expected to commence in 2018 and be completed within two to three years.
In the second project phase, some $282 million will be invested to build a commercial vehicle tyre production facility with a million tyres a year capacity. The tyre maker has given the date of 2020 for design and construction of this second plant.
Triangle Tyre states that no less than 30 per cent, or $174 million, of the $580 million will be drawn from its own funds, and no more than 70 per cent, or $406 million, from bank loans and other sources. At the end of September 2017, the company possessed a total cash balance of RMB 3.75 billion ($565.3 million), an amount Triangle Tyre considers “sufficient for its own funds to guarantee the investment demand;” for bank loans, the company currently has a total credit of RMB9.5 billion ($1.4 billion) with banks, of which RMB3.6 billion has been utilised, leaving a credit balance of RMB5.9 billion ($889.4 million). Specific to the project, the Weihai brand of the Bank of China and the Shandong brand of the Export-Import Bank of China have issued Triangle Tyre with a Loan Letter of Intention to ensure the project’s input demands.
The Chinese manufacturer indicates its preference of North Carolina as the site for its new factory, however it says a degree of uncertainty still surrounds the selection of a specific site as it is still negotiating various conditions.