Continental starts China tire plant expansion

Hefei, China – Continental has broken ground on phase 3 of its expansion project at its tire plant in Hefei, Anhui province.

According to the company, the project has €250 million earmarked for the next two years and will see passenger car tire capacity increase from 5 million tire/year today to 14 million tire/year by 2019.

By May 2015 the company had produced 10 million passenger car and light truck tires, mostly for the China market.

“We are planning to have first tires of phase 3 out in the last quarter of 2016. Further speed of the ramp-up depends on the market environment,” Michael Egner, general manager of Continental Tires (China) told ERJ, following the ground-breaking event on 16 Nov.

The company will also pump additional investment into the bicycle tire segment to make the capacity rise from its current level of 2 million unit/year to 13 million unit/year by 2025. “It is a long term strategy and we are at the moment in planning phase of this project,” added Egner.

The plant currently employs 1,150 staff and is expected to double the figure in 2017. The new capacity is still focusing on the China market, and the percentage of replacement tires is also expected to increase.

"Even with fierce competition, China is still a big market for us and full of opportunities," said  Philipp von Hirschheydt, executive vice president of Continental's business unit replacement APAC.

"It’s an important strategic undertaking that fosters the long-term development of Continental Tires in China."