Taiwanese tyre manufacturer Hwa Fong Rubber Industry Co is planning to spend 1.53 billion Baht (US$46.22 million) for the construction of a new tyre plant in Thailand to expand its capacity in the country as it works to meet the growing demand in Southeast Asia.
The firm, which operates its Thai business through Hwa Fong Rubber (Thailand) PCL, is to build a new plant to produce motorcycle and bicycle tyres.
The first phase is scheduled to be completed by the end of next year, Hwa Fong said.
The company’s two existing plants in Samutprakarn, Thailand, produce 25,000 motorcycle tyres and 32,000 bicycle tyres per day.
Through collaborations with Japanese conglomerate Sumitomo Corp, the company sells its Thai products to Japanese motorcycle brands such as Yamaha Motor Co Ltd and Honda Motor Co Ltd.
Hwa Fong, which set up an Indonesian subsidiary at the beginning of this year, said it is also considering building new plants in that nation as it eyes strong business potential in Southeast Asian nations.
The company’s two major Taiwanese competitors — Cheng Shin Rubber Industry Co and Kenda Rubber Industrial Co— have both announced plans to expand their presence in Indonesia this year.
Last month, the company secured a NT$1.65 billion (US$54.69 million) syndicated loan from seven domestic banks led by Bank of Taiwan.
From January through last month, the company posted sales of NT$3.93 billion, down 5.23% from NT$4.15 billion the previous year.