Weifang, China – Shandong Haohua Tire has progressed its project to build a manufacturing plant in Sri Lanka with 20 million-unit annual capacity for high-performance radial tires.
According to Sri Lanka media reports, the company signed an agreement with the country's board of investment on 19 Nov for the project to be located in Hambantota.
While the company has yet to issue a press statement, details of the project have been confirmed by sources in China, including a report by the Shandong Provincial Rubber Industry Association (SPRIA).
The SPRIA put planned, phase I capacity at 1.5 million units/year for truck/bus tire and 7.5 million units/year for passenger car tires. Combined annual output from the Sri Lana unit, it added, would be worth $500 million (€422 million).
The plant is subsequently expected to produce 3 million truck and bus tires and 17 million passenger car tires, the Chinese tire maker informed ERJ in May.
At that time, the company stated that it had earmarked $200 million for phase I of the project, sited on the coast of Sri Lanka, to the southeast of its capital Colombo.
The project was originally due to break ground earlier this year, but was delayed due to the coronavirus pandemic, added the company. Construction of the project was scheduled to take 18 months.
Headquartered in Weifang, Shandong province, Haohua is also upping truck and bus tire capacity at its existing site in the city’s Shouguang county, ERJ also reported in May.
With €195 million (1.5 billion yuan) investment, the project aims to add 3 million units of annual capacity and is now in partial operation.
Full operation was slated in mid-2020 but is postponed as well, on account of uncertainty in market conditions and insufficient manpower, the company told ERJ.
Haohua Tire has three plants in China with an overall nameplate capacity of 5 million truck and bus tires and 20 million passenger car tires each year.
The company manufactures over 700 tire products under labels including Lanvigator, Aplus, Compasal and Royal Black.
In 2019, Haohua Tire had €785 million production value and exported $500 million-worth of tires.