Kumho Tire inaugurated its passenger car tire plant in the U.S.

U.S.: Kumho Tire celebrated the grand opening ceremony of its tire manufacturing plant in Georgia, U.S. on May 2, 2016. The tire plant is capable of manufacturing four million passenger car tires a year. Establishment of this tire plant is a strategic move of the company to expand its market share in the U.S. tire market.

The newly build tire plant is poised to focus largely on the orders from the leading automobile OEMs, thereby supporting the company’s strategy to expand its horizon in the OEM tire market of the U.S. Therefore, 80% of the production capacity of the newly build plant is dedicated to the demand generated from the OE market. Kumho Tire’s focus on OE tire market is likely to foster its partnership with Kia Motors. Moreover, in order to address the demand for better quality tires, the Kumho Tire Inc. would focus on ultra-high performance tires in the country.

As per the statement released by Park Sam-gu, Chairman of Kumho Asiana Group, “North America is home to one of the world’s largest auto and tire markets. We believed a production base on this crucial continent is a must if we are to significantly expand our presence in the market in our bid to become a top tire manufacturer.”

The newly build tire plant is equipped with latest technologies which are anticipated to simplify the tire manufacturing process. The tire manufacturing material is implanted with RFID tags which would enable the company to track all the details of the tires. Moreover, a tire can be rolled in a scanner, in order to check any deformity. Further, the details of that tire can be viewed on the large screens, thereby, enabling the employee to resolve any problem, if observed.

According to a recent report published by TechSci Research, “United States Tyre Market Forecast and Opportunities, 2020” the United States automobile market is the second largest automobile market in the world, with a motorization rate (including passenger cars and commercial vehicles) of more than 790 vehicles per 1,000 individuals, in 2014. Increasing disposable income due to strengthening US Dollar, falling oil and food prices, and rising standard of living, are resulting in an increase in production and sales of vehicles in the US. Moreover, replacement tire segment accounted for more than 80% share in the United States tire market in 2014. However, the share of replacement tire segment is expected to decline over the forecast period, due to faster growth anticipated in the OEM tire segment.

As per TechSci Research, Kumho Tire’s initiative to establish tire manufacturing plant in the U.S. is likely to support expansion of its market share in the country, especially in the OEM market.