Linglong advances $2bn tire manufacturing complex in Egypt

Cairo – China’s Linglong Group has signed a memorandum of understanding (MoU) with Egypt’s Ministry of Industry to establish an “integrated industrial complex” for manufacturing tires and conveyor belts, involving around $2 billion (€1.7 billion) in investment.

The planned complex will manufacture passenger car, truck and bus tires, as well as conveyor belts, and will include several supporting industries and production inputs, the Egyptian government announced 4 Sept.

These will include “feedstock industries” such as carbon black and steel cords, with the aim of deepening local manufacturing and establishing an integrated value chain around tire production, the statement added.

The project is expected to create more than 5,000 jobs and support the transfer of technology and expertise, said the government without providing further capacity details or a timeline. 

Production will serve the Egyptian domestic market as well as target exports to European and US markets.

The Egyptian government initially unveiled the investment in April, stating that the project was under discussion with local partner Nile Co. in the Borg El Arab area, southwest of Alexandria.

Linglong separately announced that the project was still in the preliminary planning and feasibility study stage, with the group working on land approval, environmental assessment, funding arrangements, and negotiations with partners.

The MoU came a day after another Chinese major, ZC Rubber, inked a letter of intent with the Egyptian government to build a $500-million ‘tire complex’ in the Ain Sokhna Industrial Zone within the Suez Canal Economic Zone.

The two announcements follow a recent round of investments by Chinese tire makers and suppliers in the North African country.

In June, Sailun Group unveiled a $1.1 billion expansion project at its currently under-construction facility in Sokhna Integrated Industrial Zone within the Suez Canal Economic Zone (SCZONE).

That proposed investment would add 27 million PCR, 1.65 million TBR and 20,000 tonnes of OTR tire capacity annually.

Also in June, China’s Longmarch Group broke ground on a €160 million tire manufacturing project in Egypt, to produce 600,000 truck and bus tires (TBRs) per year.

In the second phase, the plant will increase TBR capacity to one million units per year and add capacity to produce 4.5 million passenger car tires annually.

In July, Egypt signed an agreement with China's Zenith Group to build a $300 million facility producing tire steel reinforcement materials at the SCZone.

The project, located within the TEDA Egypt industrial zone, will produce 120,000 tonnes/year of steel cord for tires and 50,000 tonnes/year of bead wire.

Aeolus Tyre is also expanding its presence in Egypt through a €340 million joint venture in Alexandria in addition to its presence through Prometeon Tyre Group.

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 PTG's plant in Alexandria, while also acquiring adjacent land for expansion.