CHUNGLI, Taiwan (May 31, 2005) — Federal Corp. is investing $30 million in its Federal Tire (Jiangxi) (JFT) subsidiary in China to double annual radial car and light truck tire capacity to 5 million units by year-end.
The investment will go toward new rubber mixing, tire building and uniformity testing equipment.
The project will expand the range of sizes Jianxi, Nanchang-based JFT can produce and allow the firm to expand its product lines, Federal said.
JFT makes Federal's entire range of Federal and Hero brand tires, covering passenger (including high performance), light truck and sport-utility vehicles.
Federal, the world's 49th ranked tire maker with 2003 sales of $143.5 million, also is raising capacity at its Taiyuan, Taiwan, plant and by 2006 Federal expects the combined capacity of its two plants to exceed 8 million units.
The company has operated JFT since 1997, when it took over full ownership of the former Hero Tire Factory. Up to now, the plant has made primarily 80-series radial passenger tires and bias-ply truck, bus and agricultural tires, primarily in the Hero and Maxon brands.
Federal intends to start selling the Hero brand in North America in 2005, but hasn't disclosed the timing of that launch. Federal does not have a North American-based importer/distributor; interested dealers must order containerloads directly from Taiwan.