ENSO to build tire plant in the USA
ENSO, a British startup that develops and supplies tires for electric vehicles, has signed a letter of intent with the US Export-Import Bank to build a carbon-neutral tire factory in the United States. The project is estimated to cost $500 million.
ENSO's technological partners will be Rockwell, which specializes in industrial automation solutions, and Arup, which provides design, planning, and other services. The project will also be supported by US investment firms 8090 Industries and Galway Sustainable Capital.
According to ENSO, the factory will be built using carbon-neutral materials, and the facility will use "green" raw materials and electricity generated 100% from renewable sources. It is expected that by 2027, the factory will be able to produce 5 million tires for electric vehicles per year, with a workforce of 600 people. Once the factory reaches full capacity, it will produce 20 million tires annually (8% of the total US market demand), with a workforce of 2,400 employees.
Currently, the company is selecting a location for the production site, with possible options including Georgia, Colorado, Nevada, Texas, and other states. It is noted that there are already many electric vehicle owners in the US, especially in California, and "since the country is actively working to increase the energy efficiency of vehicle tires and reduce harmful emissions, it is an ideal market for ENSO." Additionally, ENSO had previously agreed to produce its tires at the Iris Tyres factory in Algeria.
ENSO adds that the regulatory environment in the US was one of the reasons for choosing the country for the project. In particular, in 2022, the US passed the Inflation Reduction Act, which provides significant funding to reduce the carbon footprint. The new law has had a significant impact on the automotive and, consequently, the tire sector, says ENSO, adding that the implementation of new requirements for energy efficiency and environmental sustainability of tires in the US (including in California, where they are working to control the use of toxic antioxidant 6PPD by tire manufacturers) also aligns with the company's goals.
"The United States is the ideal choice for locating our first carbon-neutral tire factory," said Gunnlaugur Erlendsson, CEO of ENSO. "Given the favorable regulatory environment and significant market opportunities, we intend to offer our innovative, eco-friendly, and affordable tires to American consumers. The new factory will make tires more accessible, reduce emissions, create excellent jobs, and improve the environmental sustainability of the US tire industry."
According to ENSO, there are 275 million vehicles on US roads, with most tires being imported. The new factory will reduce the local market's dependence on imports, and the company emphasizes that American consumers are willing to pay for innovative products. For example, almost 46% of drivers prefer to buy tires made with reduced amounts of substances; 43% prefer tires that reduce harmful emissions; and 41% prefer tires produced using recycled materials. There is also demand for US-made tires, with 47% of motorists preferring to purchase them (according to ENSO).
"Our mission is to make electric vehicles more widespread and reduce pollution related to tires, as well as reduce the expenses of American drivers," says the company. "Our tires already increase the range of electric vehicles by 10% and reduce emissions of harmful particles by 35%, and the production of durable, high-tech tires will also reduce the environmental impact."
According to ENSO, every year, 6 million tons of harmful particles are generated due to tire wear, which significantly affects ocean pollution with microplastics. The tire industry is also characterized by carbon intensity and the generation of a large amount of waste, and the company aims to decarbonize the industry and plans to completely abandon the use of fossil-based raw materials by 2030, replacing them with alternative materials, including those of biological origin.