Sailun Group Co. Ltd. plans to double capacity for radial truck and bus tires at its plant in Liaoning to 6 million units a year by 2022, the company disclosed Feb. 28.
Sailun is budgeting $285 million for the project, which will add 1.22 million square feet to the existing Liaoning facilities.
Sailun said at about a third of expanded production is targeted for overseas markets such as South America, Africa and other Asian areas. The tire maker said it expects truck/bus tire demand from Brazil, Columbia, Thailand, Malaysia and Vietnam to total 1 million units in 2020.
Once fully on stream, the expansion is projected to generate in $43 million in annual net profits on $340 million in revenue.
The facilities will run at a 70% utilization rate over the first year and at a 100% rate over the second year.
The company, the No. 18 tire maker worldwide, also announced in January the completion of an expansion of capacity for passenger tires at its Dongying, China, factory, which will boost that plant's annual capacity to 27 million units a year.
Xie Xiaohong and Liang Runsheng (right), the secretary of the county party committee, tour the plant.
Sailun recently disclosed its unaudited 2019 annual sales revenue rose 10% over 2018 to $2.2 billion and net profits jumped 80% to $170 million. Falling feedstock prices and the Vietnam plant's "stellar performance" contributed to the raised profitability, Sailun said.
Besides the manufacturing complex in Liaoning, Sailun has two other factories in China and a pair of plants in Vietnam, in Tay Ninh Province, as well as a joint venture truck tire plant there with Cooper Tire & Rubber Co. that started commercial production recently.
The first Vietnamese plant opened in 2014.
