Conti to build P/LT tire plant in Thailand

RAYONG, Thailand (Jan. 25, 2017) — Continental A.G. has selected a site in Thailand's Rayong Province for its next tire plant, a car and light truck tire factory that should be on stream by 2019 and produce 4 million tires a year by 2022.

Conti is budgeting $265 million for the first phase of the project, which will help the tire maker strengthen its presence in Thailand and the Asia/Pacific Rim markets, according to Philipp von Hirschheydt, head of Conti's APAC passenger/light truck tire business unit.

The plant site and surrounding infrastructure would allow for a potential expansion of up to 25 million tires annually over time, Conti said.

"This plant will strongly support our planned business growth in both original equipment and replacement business for passenger and light truck tires and further establish our customer relations in both segments," Mr. Hirschheydt said.

"We want to benefit from the growth potential in this region in the replacement market and are confident that our local production will also enable a closer cooperation with new customers to further extend our position in these markets," he added.

"The investment in Thailand is another major step in realizing the ambitious growth plans of our Vision 2025 by further improving the balance of our global manufacturing footprint,…" said Nikolai Setzer, member of Contil's executive board in charge of corporate purchasing and the Tire Division.

"One important pillar of our long-term strategy is to operate with an agile and flexible set-up that enables us to react fast to the market requirements, establish further production capacities in the growth region APAC and to strongly support our Asia Pacific growth plans with high-tech production capabilities," he added.

Conti anticipates employing 900 workers at the plant in the start-up phase.

Michael Egner, project manager, greenfield APAC, lauded the Thai government and other local institutions for being "very supportive" partners during the selection process.

"The site selection process is very complex," he said, "where we have to take into account not only the proximity to the markets and our customers, several infrastructure elements but also the workforce available as well as educational institutions which will support us to recruit the best skilled employees."

The 185-acre site in Rayong Province complies with all requirements, Conti said. It is close to the targeted markets and customers, offers a good infrastructure being less than 90 miles from Bangkok and 35 miles from the deep-sea port in Laem Chabang.

There also are universities with a technical profile located nearby. Continental expects to break ground in the course of 2017.

Since the start of Continental's Vision 2025, the Tire Division has invested more than $3 billion to expand its production and research and development facilities worldwide. Included in that sum are five greenfield tire plants – Timisoara, Romania; Camacari, Brazil; Hefei, China; Kaluga; and Sumter, S.C. – with one more, in Clinton, Miss., under construction.

The Rayong plant will be Conti's sixth factory in the Asia/Pacific region. The others are in Hefei, China; Alor Setar and Petaling Jaya, Malaysia; Modipuram, India; and Kalutara, Sri Lanka.