Kumho Tire shares drop over 9% following fire at major Korean plant

Seoul – Kumho Tire shares fell more than 9.3% following a fire at the company's largest production facility in Gwangju, South Korea, which occurred over the weekend. 

As of 14:00 local time on 20 May, the shares were trading at KRW4.33, down from KRW4.80 on 16 May.

The Gwangju factory has a capacity to produce 12 million tires a year, accounting for nearly 20% of Kumho's global production capacity, according to company data.

In an 18 May stock exchange filing the Korean tire maker apologised to all those affected by the fire, including local residents for the distressed caused by the blaze.

“We at Kumho Tire have formed an emergency response team to promptly address the damage recovery and support for residents,” said the announcement adding that the company was cooperating with the relevant authorities over the incident.

The company said it will “thoroughly investigate” the cause of the fire, which took 77 hours to extinguish.

Kumho did not provide further details about the damage caused by the fire or its impact on its financial outlook for the year.

According to local press reports, the fire occurred in the mixing area of Plant 2 of the Gwangju factory, located on the west side of the complex.

ERJ has contacted Kumho Tire for further comments.