Hankook gives details of Hungary investment

Seoul, Korea -- Hankook Tire has said its first European car and light truck tyre factory will be built at Dunaujvaros, Hungary. The plant is due on stream in 2007, reaching total production capacity of 10 million units/year by 2010. The investment will be around Euro 500 million, said the company in a news release.

The company said its chief executive, Cho Choong-hwan made a final decision on the 31st of October 2005 to select Dunaujvaros as the site to build its new plant to step up its efforts to pursue the European markets.

He added that the company will create a global production system linking Korea, China and Hungary

Hankook Tire's new factory in Hungary which will serve as the tyre maker's production base in Europe will be built on a 53-hectare site in Dunaujvaros, 68km south of the Hungarian capital Budapest.

The plant will hire 1500 local employees and produce 10 million ultra-performance tyres for passenger vehicles and light trucks annually. Hankook said the majority of goods produced in this new plant in Central Europe will be supplied to Europe, which is the company's major strategic market.

In a statement, Hankook said its exports to Europe accounted for 36.8 percent of the total exports last year, amounting to $317 million. Hankook Tire's total exports amounted to $862 million in 2004. The projected exports to the European market are estimated at $400 million this year.

In 2008, Hankook Tire's annual production volume will reach 70 million units. The company is currently ranked ninth among the world tyre makers, but has ambitions to emerge as one of the world's top five producers.

Hankook Tire is currently producing over 58 million tyres a year from two plants in Korea (Daejeon, Geumsan) and in the Jiaxing and Jiangsu areas in China. With the construction of the Central European plant, the company will be equipped with a full-blown global production system linking Korea, China and Hungary.

A Hankook Tire insider explained, The company has been reviewing possible plant sites in Central Europe including Poland, Hungary, Czech Republic and Slovakia to supply products to the European markets, which has the highest proportion of Hankook Tire's exports. In the end, Hungary had the edge over the other candidates countries in terms of logistics and production costs, skilled workers, accessibility to Western Europe and pro-active government cooperation.”

Recently, Hankook Tire set up a local corporation in Hungary.

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Website of Hankook Europe

Hankook Tire selects Dunaujvaros, Hungary as the site for its first European factory WhoWon.com (US)