HANOVER, Germany — The backers of a project to build the first tire plant in Saudi Arabia are targeting mid-2024 for the start of construction.
Black Arrow Tire Co. (Blatco) said the facility, to be located in Yanbu on the Red Sea coast, will cost $1.5 billion (€1.4 billion). The plant is designed to produce 7.5 million passenger, light truck and truck/bus tires a year in the first phase. The second phase would double capacity, according to information on the company's website.
Blatco aims to start engineering work by the fourth quarter this year or the first quarter of 2024, CEO Adel Al Masood told European Rubber Journal in an interview at the recent Tire Technology Expo in Hanover.
"Construction will then start three months later … so by the middle of 2024," Masood said. He was accompanied at the Hanover conference by Blatco Chairman Abdullah Al Wahibi, and Vice Chairman Hassan Al Othman.
The project, however, still is awaiting the green light from partner Kumho Tire Co. Inc., which signed a memorandum of understanding in January 2022 with Blatco regarding the project. While the Korean tire maker still has to finalize an agreement to go ahead with the project, Masood commented: "We feel comfortable that will be done before the end of this year."
Finalizing all the details requires "a lot of due diligence and agreement on many, many details," the CEO added, noting that a Kumho team has been visiting the project site and meeting government agencies in Saudi Arabia.
Blatco estimates the size of the Saudi market for tires at more than 30 million units, which is fulfilled completely by imports, primarily from China, Japan, South Korea and Thailand. Blatco's short-term goal is to capture 15% of the Saudi market by 2026.