HONG KONG — Prinx Chengshan Tire Co. Ltd. — a former Cooper Tire & Rubber Co. joint venture — has agreed to buy up to seven plots of land in Thailand as the potential site for a new plant, the company disclosed recently.
According to a statement published on the Hong Kong Stock Exchange, the transaction involves plots in Tambon Nong Suea Chang, Amphur Nong Yai, and Tambon Klong-Kew, Amphur Ban-Bung, Chonburi Province in deals valued at $25 million.
The total area was listed at up to 2,250 acres, though the final figure is still pending local government confirmation, the announcement stated.
Land will be purchased by affiliate Prinx Thailand from WHA Eastern,Thailand's industrial real estate developer and supplier of supporting infrastructure services, such as power, water and utilities.
Prinx Thailand has also signed a water services agreement with a WHA Eastern subsidiary.
Rongcheng, Shandong, China-based Prinx Chengshan — considered the No. 33 tire maker worldwide with fiscal 2017 sales of $855 million — previously had discussed Malaysia as an overseas site but has been informed by its controlling shareholder Chengshan Group that that project was discontinued due to slow progress.
The tire maker said it believes the Thai site offers low costs for raw materials and transportation and avoids international trade barriers.
Other benefits include local preferential policies on areas such as taxes and human resources, added the announcement.
Prinx Chengshan is in the process of establishing a U.S. subsidiary, Prinx Chengshan North America Inc., in the Los Angeles area to handle shipments of truck tires to North America starting in early 2019.
Internationally the company sells under the Austone, Chengshang, Fortune and Prinx brands but hasn't yet determined what brand it will use in North America.