Yokohama budgets $600M to double Philippines tire plant

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) January 31, 2011 -- Tire Business staff report

TOKYO (Jan. 31, 2011) — Yokohama Rubber Co. Ltd. is planning to spend $600 million through 2017 to more than double the annual capacity of its car tire plant in the Phillippines to 17 million tires, with most of the added capacity dedicated to the North American market.
The expansion will occur in three stages, Yokohama said, and includes the construction of a 3.23 million-sq.-ft. addition to the 15-year-old Yokohama Tire Philippines Inc. factory in Clark Freeport Zone on Manila Bay.

Annual capacity will increase initially within the existing facility to 10 million units by 2013 and then to 13 million units by 2014 when the plant expansion is finished. This phase represents about $240 million of the total investment.

Annual capacity will rise to 17 million by 2017 as the remainder of the investment takes hold. The size of the plant will more than double to 4.95 million square feet.

The project is part of the third phase of YRC’s Grand Design 100 medium-term management plan and will increase the company’s global capacity to about 70 million units by the time it’s finished. The announcement coincides with Yokohama’s signing an extension of its tenancy agreement at Clark Freeport Zone, site of the former U.S. Air Force’s Clark Air Base.

Established in 1996 as the manufacturing base for passenger-car tires for export markets, the Philippines plant makes tires with rim diameters of 13 to 18 inches for cars and sport-utility vehicles. Most of the tires are exported to Europe, North America and Southeast Asian countries, including deliveries to car makers in North America and Asia.

Yokohama did not comment on the effect on employment, which stood at 1,900 at year-end 2010.

This latest expansion is in addition to projects at plants in Shinshiro-Minami, Japan; Hanzhou, China; Bankok, Thailand; and Salem, Va.; as well as construction of a plant in Lipetsk, Russia.

YRC’s global capacity will reach 60 million units by year-end 2012 as these projects come on stream, the firm said.

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