Aeolus Tyre plans €340 million Egypt tire expansion project

Shanghai, China – Aeolus Tyre Co. Ltd. has announced plans to invest Yuan2.68 billion (€340 million) in a tire production expansion project in Egypt through a newly established joint venture company.

The project will establish localised production in Alexandria, Egypt, to support its international growth strategy and strengthen access to overseas high-end markets, said Aeolus in an SSE filing 15 May.

Aeolus said the project would also deepen business cooperation with its wholly owned subsidiary Prometeon Tyre Group.

The investment will be carried out through a newly established subsidiary, Aeolus Tyre (Hainan) Co., which will subsequently form a joint venture called Aeolus Egypt with JV partners Prometeon Tyre Egypt and Hong Kong-based China Rubber International Co. Ltd.

Aeolus Hainan is expected to hold a 98.93% stake in the venture, with Prometeon Egypt and China Rubber International holding 1% and 0.07%, respectively.

According to the filing, the Egypt operation will focus on the production and sales of truck and bus radial (TBR) tires, off-the-road (OTR) tires and agricultural tires.

Planned annual capacity includes 1.5 million TBR tires, 30,000 OTR radial tires and 30,000 farm radial tires.

The project will utilise existing land and part of the utility infrastructure at Prometeon Egypt’s plant in Alexandria, while also acquiring adjacent land for expansion.

Construction plans include new radial tire production workshops covering mixing, semi-finished components, tire building, curing and inspection operations, as well as a finished goods warehouse, testing station, laboratory facilities and utility systems.

Aeolus said the construction period is estimated at 20 months.

In the filing, the Chinese tire group said the Egypt investment would help “optimise global production capacity layout” by leveraging its strengths in industrial tires.

The project, it added, would “strengthen development of overseas high-end markets” and enhance its “profitability, global competitiveness and brand influence.”

The investment remains subject to outbound investment approvals in China as well as regulatory approvals in Egypt.