TOKYO (Feb. 14, 2013) — Yokohama Rubber Co. Ltd. will invest about $125 million through 2015 to boost capacity at tire plants in the Philippines and Russia to support greater exports at the former and enhance local supply at the latter.
In the Philippines, Yokohama is budgeting $118 million through 2015 to boost capacity at the 17-year-old plant 25 percent to 12.5 million car and light truck tires a year by year-end 2014. The capacity is slightly smaller than originally projected two years ago, YRC said, because the product mix will more skewed to larger-diameter, higher value-added tires to meet changing market demands.
The plant, which opened in 1996, has capacity for tires up to 18 inches rim diameter, YRC said. This expansion will add capacity for tires up to 20 inches rim diameter, the firm said.
The plant, operated by Yokohama Tire Philippines Inc. at an industrial complex on the site of the former U.S. Clark Air Force Base, exports most of its output to aftermarket customers in North America, Europe and Southeast Asia as well as OE accounts in North America and Asia.
To accommodate the expansions, the company has more than doubled the size of the plant's site area to 113 acres.
The project is part of Yokohama's longer-term plan to expand the factory to 17 million units annually by 2017.
In Russia, Yokohama has budgeted $5.5 million to expand capacity at its Lipetsk plant to 1.6 million units annually to help satisfy Russian demand for its products, which it puts at 3 million units annually.
Yokohama said its decision to invest is aimed at promoting "local production for local consumption."
The tire maker opened the $165 million plant in May 2012 and expects it to reach the initial planned annual capacity of 1.4 million units this summer.
At the plant's dedication last year,Yokohama said it was planning to "reinforce" the 462,680-sq.-ft. plant's production capacity in stages and was in the process of securing a 50-plus acre plot of land from the Lipetsk Special Economic Zone for expansion.
Production is focused on the firm's "C. drive2" passenger tires and "ice GUARD iG35" studded winter tires in 13- to 18-inch rim diamters. Yokohama said it also plans eventually to export some products to Europe from Lipetsk.
The company established the Russian venture — an 80-20 joint venture involving Yokohama and Japanese trading company Itochu Corp. — in December 2008. Employment at year-end 2012 was 557.