GUANAJUATO, Mexico — China's Sailun Group broke ground May 16 on $240 million factory in Guanajuato, a move the company said underscores its commitment to the North American market.
Upon completion, the state-of-the-art factory will have capacity for about 6 million tires annually. Ultimately, though, Sailun expects to eventually expand on that capacity by as much as 1.8 million units.
Sailun noted the plant's strategic location allows it to serve the North American market effectively with locally sourced products.
"We are thrilled to embark on this exciting journey as we break ground on our new factory in Mexico," Peter Koszo, president of Sailun Group of Companies in North America, said in a statement.
"This expansion represents a significant investment in our future and reaffirms our commitment to providing top quality tires for the North American market and allows us to continue to diversify our product offerings."
Sailun, considered the No. 12 tire maker globally with fiscal 2022 sales of $3.22 billion, is building the plant in a joint venture with Mexico's TD International Holding S.A.P.I. de C.V.
The JV, to be called SL & TD Tire Manufacturing, will be 51% owned by Sailun's Singapore subsidiary, while local enterprise TD Mexico will own the remaining 49%, Sailun said earlier.
Qingdao-based Sailun's business in North America is handled through Sailun Tire Americas of Brampton, Ontario. TBC Corp. is the exclusive distributor of the Sailun Tires brand in the U.S. market.
Sailun supplies the U.S. market principally from factories it built in Vietnam and Cambodia after the U.S. imposed elevated import duties several years ago on passenger tires from China.
The North American expansion is the latest in a string of investments that underpin the company's vision for global growth and local-to-local product sourcing.
Those investments include a $250 million plant in Indonesia and expanded capacity in Cambodia.
It's also one of three new factories set to open in Mexico in the coming few years. The others are:
- Yokohama Rubber Co. Ltd. (YRC), which broke ground April 15 on a $380 million passenger and light truck tire plant in Saltillo, Mexico, that's secheduled to open in 2027 with a rated capacity of 5 million tires a year.
- Zhongce Rubber Group Co. Ltd. (ZC Rubber) is planning to build a tire factory at a site near Saltillo in northeastern Mexico about 150 miles from the U.S. border, but to date hasn't released details as to the factory's product mix, size, capacity or value.