Guizhou Tyre to build new plant in Vietnam
Guizhou Tyre Co. Ltd., producer of the Advance and Samson brands, is planning to build a truck and bus tire plant in Vietnam valued at $245 million, according to a regulatory filing in April.
The plant, to be built in the Long Hau Industrial Park near Ho Chi Minh City, will have an annual capacity of 1.2 million units, Guizhou said. It's expected to span 1.47 million square feet on a 300-acre plot of land.
It could be on stream as early as 2018.
Guizhou—represented in North America by GTCNA of Canton, Ohio—said it expects the operation to generate $21 million annual profit on $149 million in sales.
"We are still in the beginning stage of getting regulatory approval and it may take a few years before the plant is completed," Guizhou Tyre's board secretary Li Shangwu said.
Having a plant in a major rubber-producing country like Vietnam will lower the company's logistics costs and shorten the delivery cycle, according to the filing, and also help avoid the impact of trade tariffs.
Last year, Guizhou Tyre reported net earnings of $2.6 million on 18 percent higher sales of $963 million. Overseas markets accounted for 55 percent of its 2016 revenue.