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WAYNE, N.J. – Hankook Tire announced recently that it is building its first European factory in Dunaujuvaros, Hungary. Hankook, currently Korea’s largest tire manufacturer, says this new facility will help the company step-up its efforts to pursue European markets. An investment signing ceremony was held at Hankook’s headquarters in Seoul, South Korea, where Hankook Tire CEO Cho Choong-hwan, Hungarian Minister of Economy & Transport Janos Koka and other dignitaries were in attendance.
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HANKOOK ANNOUNCES PRICES INCREASES OF UP TO 6 PERCENT |
Hankook Tire America Corp. announced recently that it is raising prices on its full line of passenger, high performance, light truck and medium truck tires by as much as 6 percent, effective Jan. 1, 2006. The increases at Hankook are consistent with price hikes announced recently by other major tire manufacturers marketing their products in the United States. The increase reflects Hankook’s rising costs in raw materials, particularly petroleum products, as well as higher costs in transportation and general operating expenses. Hankook Tire is a technology-focused, market-driven company with manufacturing facilities around the world and research and development on three continents. Hankook Tire manufactures and markets a full range of Passenger, High Performance, Ultra-High Performance, Light and Medium Truck, Winter Radial, Original Equipment, and Truck and Bus Radial Tires. |
According to a company insider, Hankook had reviewed possible plant locations in Poland, Hungary, the Czech Republic and Slovakia. Hungary had the edge over the other candidate countries in terms of logistics and production costs, skilled workers, accessibility to Western Europe and pro-active government cooperation.
Hankook Tire’s new factory will be built on a site of more than 130 acres, about 40 miles south of the Hungarian capital of Budapest. The company’s goal is to start operation in 2007. The $586 million* plant will hire 1,500 local employees and produce 10 million ultra performance tires for passenger vehicles and light trucks annually.
The majority of goods produced in this plant will be supplied to Europe. Hankook Tire’s exports to Europe accounted for 36.8 percent of total exports last year, amounting to $317 million. The company’s projected exports to the European market are estimated at $400 million this year.
With the construction of a Central European plant, Hankook Tire is hoping to resolve problems stemming from EU’s powerful economic block and the dangers of exchange rate fluctuations. The Company is also expecting a reduction in manufacturing costs and its logistics costs.
In 2008, Hankook Tire’s annual production volume is set to reach 70 million units, which would establish Hankook as one of the world’s top five producers following such global players as Michelin, Bridgestone and Goodyear.
Editor’s Note: The cost of the new Hankook facility was reported as 500 million euro and converted to U.S. dollars using an exchange rate of 1.1721 as of press time.
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