BUDAPEST, Hungary (May 29, 2013) — Hankook Tire Co. Ltd. is going ahead with the third phase expansion of its plant in Rácalmás, Hungary, committing $400 million over two years to boost capacity for car and light truck tires by 42 percent.
This latest announcement will boost the South Korea firm's investment in the plant to more than $1.1 billion since first announcing plans to build the plant in October 2005.
The expansion will boost annual capacity to 17 million tires, Hankook said, and create 950 additional jobs at the plant in central Hungary south of Budapest. Work on the project will start next month, with initial production expected to begin by mid-2014 before reaching full capacity in 2015.
Hankook did not say how much of a physical expansion the plant will undergo to accommodate the capacity boost.
"As a key investor in Hungary and an important market player in the European automotive industry, we will continue to explore opportunities to meet the growing demand of our consumers, offering state-of-the-art tire technologies," said Seung Hwa Suh, Hankook vice chairman and CEO of Hankook Tire.
The plant opened in 2007 with an initial annual capacity of 6 million tires. Output reached 9 million in 2011 and last year grew to 12 million, Hankook said. Employment stands at about 2,200.
Passenger radials, especially high-performance, account for the majority of the plant's output, Hankook said. The plant produces tires to OE conracts for Volkswagen Group and Hyundai-Kia, with further OE contracts being negotiated, Hankook said.