HORANA, Sri Lanka — A Sri Lankan business venture has restarted construction on a tire plant in Sri Lanka, 15 months after it was suspended pending a government inquiry into various aspects of the project.
Rigid Tyre Corp. (Pvt.) Ltd., a unit of United Arab Emirates-based Onyx Group, announced plans in January 2017 to build the $77.5 million plant in Horana, 35 miles southeast of Sri Lanka's capital Colombo. It was intended to produce 3 million passenger car radial tires a year.
The project, however, was put on hold due to various disputes, including around the allocation of land for the facility.
In response to a query from European Rubber Journal, a Rigid Tyre spokesman confirmed that construction activities have resumed at the site, and that the scope of investment had risen to $250 million.
Estimated tonnage of the plant has now expanded to 200,000 metric tons per year, or 12.5 million units, and the company expects to start commercial production by the third quarter of 2019, the spokesman added.
"The plant is commissioned to manufacture the whole gamut of tires that roll on the roads including passenger as well as commercial and off-road tires (OTR tires)," the spokesman added.
Breakdown of the project, he said, now includes 8 million passenger tires, 2 million radial truck/bus tires, 1 million two-wheeler tires, 400,000 tons of bias-ply truck/bus tires and 30,000 tons of solid tires.
"All tires are designed conforming to European and U.S. standards comprising high-performance and ultra-high-performance tires," according to the spokesman.
Rigid Tyre's parent company, Onyx Group, acquired Marangoni's solid tire assets in May last year. The company already supplies solid tires under the Marangoni brand.
In January 2017, Marangoni agreed to sell to Rigid Tyre solid tire business assets along with transferring equipment from Marangoni's idled Anagni, Italy, passenger tire plant.