Cooper Tire and Sailun announce Vietnam TBR tyre joint venture
Cooper Tire & Rubber Company is to form a joint venture with Sailun Vietnam Co, Ltd to build a 2 million capacity truck and bus radial manufacturing plant. Subject to closing and government approvals, the facility will be located near Ho Chi Minh City, Vietnam, at the site of Sailun Vietnam’s existing operations, which early in 2018 signed an offtake agreement to produce Roadmaster, Dean and Starfire brand tyres for Cooper. The new announcement represents the latest move in a series of cooperative moves between the two firms – Sailun Jinyu invested in joining Cooper in its GRT JV in September.
Sailun Vietnam operates two factories in Vietnam, including the Chinese manufacturer’s first outside its domestic market, located on Phuoc Dong Industrial Park, Tay Ninh Province, and manufactures car, truck and OTR tyres, with facilities for carrying out technical research for future product development.
Cooper will own 35 per cent of the new venture. Total investment in facility and equipment in the joint venture is expected to be between $220 and $240 million. Cooper stated it would be funded through capital contributions and debt, with Cooper being responsible for its pro rata share. Construction of the facility is expected to begin early next year with production commencing in the first half of 2020.
“The JV announced today is another step forward in Cooper’s strategy to expand and diversify our TBR tyre production globally, giving us additional capacity to help serve our growing original equipment and replacement TBR business around the world,” said Brad Hughes, Cooper president & chief executive officer. “We are very pleased to build on the great relationship we have with Sailun to help us address opportunities in the global TBR market.”
Zhongxue Yuan, chairman & president of Sailun Group, said, “This is positive for both parties. Our work with Cooper has been extremely productive. We are happy to expand our partnership with Cooper through this new TBR tire production facility in Vietnam that will help both companies meet our customers’ needs for quality, cost-competitive products around the globe.”
Cooper had previously said of its offtake agreement that it would provide Cooper with a “third global source of TBR tyre production to meet growing customer needs.” In additional 2018 TBR segment news, Cooper opened a new North America distribution centre dedicated to its TBR business. The 400,000-square-foot facility, to be leased by Cooper, opened in San Bernardino, California in spring. It was added to increase the speed and efficiency of Cooper’s service to TBR customers in North America.