In Egypt, a new tire plant will be built

An unnamed Chinese company will build a new tire plant worth $360 million in the Suez Canal Economic Zone in Egypt, with the Arab Organization for Industrialization (AOI) as a partner, Asharq Business reports, citing its own sources.

The Chinese investor will own a 52% stake in the new joint venture and be responsible for financing the project, while AOI will provide the land for the production site and become the owner of the remaining stake.

Production at the new plant is expected to be launched by the end of 2025. At the initial stage, the plant's capacity will be 6 million tires per year, and in the future, it is planned to increase production to 12 million tires per year.

This is not the first time that Chinese companies have planned to invest in the Egyptian tire industry. In 2019, it was announced that the local Ministry of Military Production had signed a contract with the Chinese Poly Group, under which a joint venture with a capacity of 3 million tires per year was to be built. However, it seems that this project has been frozen. In 2018, it was reported that China National Tire & Rubber Corporation was in talks with the Egyptian authorities about the possible opening of a new tire plant, but this initiative also did not develop. In 2021, AOI announced that it was planned to build two new plants. At the time, it was noted that production of tires for passenger, commercial, and cargo vehicles would be launched in Ain Sokhna on the Suez Canal coast, and a plant for the production of tires for special equipment would be built in Alexandria.

According to Tanhei, in 2022, the capacity of the Egyptian tire market was 10 million tires, while local production was only able to meet 15% of the demand, and the rest had to be imported. After the closure of the state-owned tire producer Trenco in that year, only two major tire plants remained in the country, owned by Pirelli and the local Pyramids Tires, whose combined market share is 8.2%.

Photo: Tanhei.