Linglong will build a plant in Brazil
Shandong Linglong Tire intends to invest in the construction of a new tire plant in Brazil as part of its global market development strategy. The production in the municipality of Ponta Grossa (Paraná state) will be a joint venture with the Paraguayan tire distributor and importer Sunset SA Comercial Industrial Y De Servicios.
The project plans to invest 8.7 billion yuan (1.2 billion dollars), and Linglong will own 70% of the shares, while Sunset will own the remaining 30%. The planned capacity is 12 million passenger car tires and 2.4 million truck/bus tires, as well as 200,000 tires for special vehicles. Additionally, the plant plans to repair 100,000 tires per year and produce 6,000 tons of liquid regenerant.
The new plant will be built in three stages, with construction scheduled to begin in the third quarter of 2025 and full capacity expected by 2032. As part of the project, Linglong also plans to build a solar power plant at the plant, capable of generating 43 million kWh per year.
The plant will be built as part of the "7+5" strategy, which implies that Linglong will produce tires at seven sites in China and five more in other countries. The company already has its own production in Thailand and Serbia.
Linglong notes that Brazil has a developed automotive industry, and companies such as Fiat, General Motors, and Volkswagen have plants in the country. Additionally, 18 projects in Brazil have been launched by Chinese automakers, including Chery, JAC, and Lifan, creating a powerful automotive industrial cluster in the country.
"The new production will allow us to continue to improve the efficiency of tire supplies to European and American automakers," emphasizes Linglong.
The new plant will sell tires in the region, for example, in Argentina, Paraguay, Uruguay, Venezuela, Bolivia, Chile, Colombia, and Mexico, as well as supply products to India and a number of African countries, such as Egypt and Angola.
The company expects the new enterprise to generate revenue of $1 billion with a profit of $160 million per year.
Photo: Autohome.com