China's Qingdao Sentury Tire Co. Ltd. has put on hold indefinitely plans to build a car and light truck tire plant in the U.S., according to various sources close to the project.
The company — which sells tires under the Delinte, Groundspeed, Landsail and Sentury brand names — had disclosed plans in September 2016 to invest $530 million to build a plant in Troup County, Ga., capable of producing 12 million car and light truck tires a year at full capacity. The project represented up to 1,000 jobs.
Sentury originally projected the plant would be operating by 2018 but to date only minor site preparation work has been carried out, local sources indicated.An office set up by Sentury Tire North America (STNA) in LaGrange has closed, and Rami Helminen — a former Nokian Tyres P.L.C. executive who was hired in 2017 to head up the project — is now working in the U.S. for Finrenes Oy, a Finnish biomass-to-fuels company.Late last year the company consolidated separate U.S. sales organizations — one attached to the Georgia plant project and one reporting directly to the parent company in China — under Miami-based Sentury Tire USA Inc.
The Development Authority of LaGrange posted a statement on its Facebook page on May 22 stating that the "project is on indefinite hold" until the company can secure the financing necessary to complete the work.
The agency cited the uncertainty of an Initial Public Offering (IPO) in China as the reason for delaying the U.S. factory project.
"Unfortunately," the agency's statement said, "with all of the uncertainty with the trade relations between the U.S. and China, the Chinese Government Agency that approves IPOs in China put Sentury's IPO on hold indefinitely. The IPO is critical to Sentury being able to finance the project. ..."
At that time, the Times-News — a daily newspaper covering Troup County — noted in its reporting on the matter that the 400 acres of land near Pegasus Parkway near LaGrange designated for the plant "sits mostly untouched, with no construction under way."
Since announcing the project in 2016, Sentury Tire has said little publicly about the project, citing confidentiality restrictions related to the IPO — proceeds of which were designated in part to fund the construction of an aircraft tire plant in China.
Pat Wilson, commissioner of the Georgia Department of Economic Development, told Tire Business in a prepared statement:
"We are proud of the confidence Sentury Tire has shown in making Georgia the primary choice for their first U.S. manufacturing facility. While the company has not been able to meet the aggressive timetable first proposed for constructing the plant, Sentury's leadership has pledged to continue working to secure all necessary financing needed for the project."Delays like this, while unfortunate, are understandable whenever a business enters a new international market with this level of investment. We continue to work closely with the LaGrange leadership to ensure the community is kept well informed and updated on the progress of this project.
"The state of Georgia and LaGrange remain fully committed to the project and look forward to working with Sentury Tire on a new timeline for construction of their manufacturing plant and first production of Georgia-made tires for the U.S. market."
Sentury officials in China
and the U.S. did not respond to multiple requests for comment.
In the meantime, Qingdao Sentury is using its 4-year-old factory near Bangkok, Thailand, to supply customers in the U.S. The plant, in which Sentury invested $400 million, is rated at 12 million car and light truck tires a year.
Sentury Tire USA maintains warehouse distribution centers in Miami; Memphis, Tenn.; and Southern California.
This development is the second setback involving a Chinese tire maker that had announced plans for a U.S. plant.In June 2018 Guangzhou Vanlead Group Co. Ltd. was forced to put on hold indefinitely plans it had announced in 2017 to invest $1 billion in a tire plant in South Carolina.
Guangzhou Vanlead, a China state-owned entity that controls Wanli Tire Group, had proposed building a tire plant in Orangeburg County, S.C., capable of producing 6 million consumer tires annually in the eight-year project's first phase.
Sources at the Orangeburg County Development Commission (OCDC) confirmed last June that the project was in "neutral," although the OCDC didn't rule out completely that it may still come to fruition.
A third China company, Triangle Tire Co. Ltd., disclosed plans in late 2017 for a pair of plants to be built near Rocky Mount, N.C. — one for passenger/light truck tires and one for truck/bus tires.
At last report, the company had begun clearing land at the site, work that was interrupted last September by the heavy rains that accompanied Hurricane Florence as it drove inland through the Carolinas.
