Conti to build greenfield tyre plant in Russia

By David Shaw, ERJ staff

Hanover, Germany -- Continental has revealed plans to build a new car tyre plant in Russia. Nikolai Setzer, head of Conti's passenger car tyre unit, told ERJ that the company hopes to select a site for the unit by the end of June and to begin production in the last quarter of 2013.

The plant would have capacity for 4 million units annually and represents an investment of around euro 200 million over the four-year period. Setzer said the plant would make tyres in different brands, including Continental, Gislaved, Barum and Matador, with the aim of competing both in the top-end tyre markets, often called the A segment and also the lower B segment.

He said the company currently ships tyres to Russia and has been developing a distribution and sales network in the region to build sales volume, and the plant will serve a range of OE and replacement customers once it is on stream. Setzer said, "In the past we tried many things in Russia and we have learned our lessons, but now we want to be serious. So we go 100 percent greenfield."

Setzer said the new plant is part of a global expansion strategy which will commit over euro 1000 million in the coming years to increasing capacity around the world - notably in Brazil with the doubling of the company's tyre factory in Camaçari; a new plant at an unspecified location in the United States, which would also serve OE and replacement markets; the acquisition of Modi Rubber which is still subject to final contracts. Setzer also said the company expects to hold an opening ceremony next week at its facility in Anhui, China, where tyres came off the production lines two months early.

Setzer said there was not much more to add to news of the Modi acquisition, but Modi Tyres operates a tire factory complex in Modipuram, Uttar Pradesh, near New Delhi and Setzer said he hoped to add a small factory to make around 1 million passenger car tyres annually, making use of the mixing and calendering at the truck tyre factory.