Sailun breaks ground on $250m Indonesian tire plant

Central Java, Indonesia – Sailun Group has broken ground on a previously announced greenfield tire manufacturing plant in Demak city, Central Java province. 

In a 27 Sept statement, the Chinese group said it has officially started construction work on the $250 million (€230 milion) tire factory at the Jiateng Industrial Park. 

Unveiled earlier in March, the project will have the capacity to produce 3.6 million units of tires and 37ktpa of off-highway products. (ERJ report). 

In its latest statement, Sailun said the Indonesian project was an “important part” of the group’s globalisation strategy, which also includes a new manufacturing base in Mexico. (ERJ report)

Once completed, the plant will enhance “the competitiveness and influence of Chinese tire brands in Southeast Asia and the global market,” Sailun added. 

In addition to its three facilities in China, Sailun currently operates two overseas tire plants in Vietnam and Cambodia. 

The projects in Mexico and Indonesia will further strengthen the group's position globally, according to deputy general manager for production, Cao Guoqiang. 

As reported by ERJ, the facility is expected to be constructed in 21 months and aims to tap into Indonesia’s “abundant labour and natural resources” which provide “unique advantages” for the tire industry. 

Sailun is the second Chinese tire maker to announce expansion into Indonesia over the recent months.

In February, China’s largest tire producer ZC Rubber unveiled plans to build a tire facility in the country. (ERJ report)