ZALAU, Romania — Group Michelin is investing roughly $105 million in a pair of plants in Romania, to cover the start of production of new tire models at one and expand steel cord output at a second, according to local press reports.
The French tire maker is budgeting $37.5 million at its tire plant in Zalau for new models that will target the lower levels of the "intermediate" market segment and will include the Tigar brand.
The new investment will create 100 jobs through to 2021, according to the "Romania Insider," which noted the Michelin Zalau Anvelope factory will become the group's "only European plant" to manufacture the new models.
"The plant is now ready to deal with new challenges by setting up modern equipment, launching new brands and implementing a business model that links the plant directly to the client," the report quoted Sean Parry, the director of the Michelin Zalau industrial platform, as saying.
Michelin produces some 130 tire models at the Zalau facility that are aimed for the Europe, Middle East and African market. The facility employs 1,130.
Michelin also is investing $68 million through 2019 at its steel cord plant in Zalau to boost capacity there by 50 percent to 60,000 metric tons, the company said.
The investment will help create 140 jobs at the Michelin Cord Zalau plant, where 350 are employed now. The expanded plant will supply metal cord to Michelin plants worldwide.
Michelin has been manufacturing in Romania since 2001 when it acquired two tire plants, a retread plant and a domestic distribution network from Tofan Grup, the local enterprise that had taken over the bulk of Romania's state-controlled tire industry after the collapse of communism there in 1990.
Michelin gained control of the Tigar brand in 2008 when it acquired full control of the Tigar Tyres joint tire venture in Serbia.