Guizhou Tyre Co., Ltd. disclosed Jul. 3 that except the Vietnam branch, it had no such plan as building overseas plants.
With regard to the progress of the establishment of Vietnam plant, the tire producer revealed that it is preparing for the construction, which hasn’t begun yet.
The general meeting of the board proposed to invest 1.67 billion yuan in the Vietnam plant and the construction will last 12 months.
An industry analyst said the construction of the overseas plant might for avoiding the U.S.’s anti-dumping and anti-subsidy probe against tire products from China and increasing the share of overseas income.
Over the past few years, although Guizhou Tyre accelerated the overseas market expansion, its business operation was poor.
Excluding non-recurrent profit and loss, the firm’s net loss in 2016 was 272 million yuan. It’s weighted average return on net assets was the worst for two straight years among all listed tire companies.
At an earlier shareholders meeting, except the firm’s own shares of stock, about 25% participants were against the proposal for building the Vietnam plant.
Therefore, whether the Vietnam plant construction plan will be implemented smoothly is still unknown.
