China’s Shandong Linglong Tire held the groundbreaking ceremony for its greenfield tyre factory project in Zrenjanin, northern Serbia, signaling the start of construction for the US$994 million project – the factory will be built in three phases, with the final phase to be completed in March 2025.
Linglong has secured 320 acres of land in the Zrenjanin Free Trade Zone for the plant, which itself will span 4.24 million sq ft. Linglong has planned to invest about US$900 million on the construction of the factory, which will later have 1,200 employees and will produce 13 million tyres annually. The Chinese company will operate the factory through Serbian subsidiary, Linglong International Europe.
Shandong Linglong’s tyre output is currently at 13.6 million units/ year: 12 million car tyres, 1.6 million truck/bus tyres, and 20,000 off-road tyres. The company disclosed its selection of Zrenjanin in August 2018, concluding a two-plus year search for a second overseas site after the first plant opened in Rayong, Thailand in 2014.
To date, the Zrenjanin plant represents the largest foreign investment in northern Serbia and will employ artificial intelligence, mobile sensing, “big data” and robotics in its future operations.
Shandong Linglong, listed as the 17th tyre manufacturer in 2017, based on sales of US$2.18 billion, expects the development of European sales to propel it to become the world’s 10th largest tyre maker, additionally facilitating the arrival of new companies to Zrenjanin.
Shandong Linglong has already begun discussion with Volkswagen and Renault in September 2018 for the sale of tyres produced by the factory as of 2021.