Hankook Tire plans to invest US$1.2bn in a global tyre manufacturing facility in Indonesia, according to government sources. 

South Korea’s largest tyre manufacturer reportedly told the head of Indonesia’s Investment Coordinating Board, Gita Wirjawan, that it will likely choose Indonesia over Vietnam as the location of the plant, with construction expected to start by the end of 2010.

The plant will have a production capacity of 15m units per year and will export tyres to other markets in the Asian region, as well as to Europe and the USA. It will likely be located in one of the industrial parks east of Jakarta. Indonesia is a key producer of natural rubber, a key ingredient in the manufacture of tyres.

Separately, Italian tyre manufacturer Pirelli has returned to the Thai market following the appointment of three distributors. So far, 80 dealers have been appointed - mostly located in the Bangkok area. A further 80 outlets nationwide are expected to be signed up by year-end.