SEOUL, South Korea — Hankook Tire & Technology Corp. has halved a global investment plan announced in February to $370 million due to "changes in business environment."
In a Nov. 1 stock exchange filing, the Seoul-based tire maker said the revision covered previously announced investments at its production facilities in South Korea and the U.S.
The capex adjustment, Hankook said, was due mainly to lower reconstruction/modernization costs at its Daejeon, South Korea, plant — devastated by fire in March — and deferral of expansion costs at its Clarksville, Tenn., plant.
In a related stock exchange filing on Oct. 31, the company Hankook Tire America Corp. had initiated a $150 million shares transaction to fund the Clarksville expansion. The capital increase is to be facilitated via the issuance of new shares for Hankook Tire America, in order to finance the project.
The US expansion is linked to a wider $1.6 billion investment program under way at the Tennessee plant through 2026.
Separately, under its revised capex plan, Hankook said it was lowering its target for the share of its passenger tire production represented by electric vehicle tires to 15% from 20%.
The tire maker, however, said its sales-growth target of 5% year-on-year remained unchanged, as did its goal of increasing the proportion of tires with 18-inch rim diameters and larger to 45% of overall car tire output.