Chinese company to build tire plant in Brazil

Chinese tire distributor Sunset Tires intends to invest 1.5 billion reals (270 million dollars) in the construction of a plant in Brazil, where passenger tires will be produced under the XBRI brand owned by the company. Currently, XBRI tires are produced for Sunset by other companies, and the new enterprise will both supply products to the domestic Brazilian market and export them to the United States.

"The project to create a new plant involves the use of the most modern technologies in the industry with an emphasis on sustainable development," the company notes, adding that tire recycling will be mastered, and energy will be generated from environmentally friendly sources.

Sunset adds that last year, more than 3.5 million XBRI tires worth approximately 4.5 billion reals (800 million dollars) were sold in Brazil, and the local market has good potential, since the average number of cars is 250 units per 1,000 people, which is half as much as in Europe and four times less than in the United States. This year, the company expects revenue to increase by 20%.

"XBRI Tires was founded 36 years ago and now occupies a strategically advantageous position, since products are developed specifically for Brazilian climatic and road conditions, however, at the moment, all tires are produced abroad," said Samer Nasser, head of XBRI in Brazil. "At the same time, production costs, logistics, and customs duties are already comparable to expenses when producing products within the country, so we believe that it's time to invest in our own plant."

Currently, XBRI is one of the leading tire distributors in Brazil, and tires are supplied, among others, to car manufacturers such as Volkswagen and Stellantis, and to the largest vehicle fleets in the country owned by companies such as Raízen, Shell, JSL, Localiza, and Unidas. The products are available in such large retail chains as Magazine Luiza, Assaí, Havan, and Rede Mateus.

"We are ready to overcome complexities and continue to evolve, which will benefit both consumers and the country's economy," Nasser emphasized.

At the moment, the company is looking for a place to build a plant, and negotiations have been launched with the authorities of Paraná, São Paulo, Rio Grande do Sul, Bahia, and Espírito Santo. It is expected that the enterprise will produce approximately 5 million passenger and 2 million truck tires per year.

Publication CPG writes that Chinese companies Linglong and Sailun also plan to build plants in Brazil, and investments may amount to 1 and 2 billion reals (180 and 360 million dollars), respectively. Meanwhile, Linglong had previously officially denied this information, and Sailun is currently building a plant in Mexico.

Sunset was founded in 1988, and companies from such countries as Vietnam, Cambodia, China, Thailand, and Turkey are involved as contract manufacturers.