Kenda OKs expansion of China plants

ERJ staff report (TB)

Taipei, Taiwan -- Kenda Rubber Industrial Co. Ltd. has brought on stream passenger tyre capacity at its headquarters plant in Taiwan and approved expansions of car tyre capacity at plants in Shanghai and Tianjin, China.

Kenda-the No. 2 Taiwanese tyre maker and No. 26 globally with sales just shy of $1 billion-recently commissioned a production line in Taiwan capable of 5,000 units a day, dedicated primarily for export to North America and Europe.

Combined with capacity at its plant in Shanghai, Kenda's daily output of consumer tyres should grow to 30,000 units.

In China, Kenda is expanding consumer tyre capacity at its Shanghai and Tianjin plants by up to 20,000 tyres a day by year-end 2012/early 2013.

As a result, Kenda's capacity for consumer tyres will hit 15 million units a year by 2013, with nearly all earmarked for domestic demand.

At the same time, Kenda has initiated a search for a location in southern China to build another plant, which would be the firm's fifth factory there.

Kenda did not disclose its expected investments in the expansion projects, but earlier this year Kenda indicated it would use some of the proceeds of the sales of its 50-percent share in Cooper Kenda Tire Manufacturing (Kunshan) Co. Ltd. joint venture with Cooper in expanding capacity at other plants, including the headquarters factory in Yuanling, Taiwan.

Cooper bought Kenda's share in the 4-yearpold venture in March for $116.5 million.

From Tire Business (A Crain publication)