Linglong to build $1bn tire plant in Serbia

Shanghai, China – Shandong Linglong Tire Co is planning to build a $994.4 million (€863 million or RMB 662,482,000) tire production plant in the Zrenjanin Free Trade Zone in Serbia.

In a 20-Aug filing with the Shanghai Stock Exchange, Linglong announced that construction work on the company’s first European production site will officially start next April.

The 6-year project will be completed in three phases, and at full capacity can produce 13.62 million high-performance radial tires per year. These will include 12 million units passenger car tires, 1.6 million unit sof truck and bus tires as well as 20,000 off-the-road tires.

Full completion of the three phases is set for March 2025.

ERJ broke the news in February that Linglong was planning its second overseas tire plant in Serbia – though the company subsequently insisted it had yet to select a location for the new facility.

However, the investment and the establishment of a Serbian entity will now need the green light from the Chinese National Development and Reform Commission.

According to Linglong, Serbia was chosen for the project due to its "cost advantage".

"The government’s economic policy is to attract foreign investment, create jobs, reform and revise investment," said the Linglong filing.

The Chinese company said it studied a number of other Eastern European states, including Poland, Czechia, Slovakia and Hungary before opting for Serbia due to its 'low labour and energy costs'.

Linglong which is pursuing a “5+3” strategy – five production plants at home and three overseas – opened its first foreign-based factory in Chonburi, Thailand in 2014.

The company is also mulling the construction of another international production base most possibly in the US, where it is represented  by Linglong Americas Inc., in Medina, Ohio.

Zrenjanin is a city of about 75,000 located in Province of Vojvodina, roughly 50 miles north of Belgrade and situated on a tributary of the Danube River. The Zrenjanin Free Trade Zone covers an area of 98 hectares and offer free trade-zone benefits.

Linglong will become the fourth tire company with a factory in Serbia. The others are: Cooper Tire & Rubber Co. (in Krusevac); Group Michelin (Pirot); and Trelleborg Wheel Systems (Ruma).