Nexen Tire plans to build its first tyre plant in the US to expand its share of the North American market, according to local media reports.
It is South Korea’s third largest tyre manufacturer after Hankook Tire & Technology and Kumho Tire, both of which already have major tyre factories in the US.
Hankook Tire last year announced plans to double capacity at its Tennessee plant to 12m units per year while Kumho has a plant in Georgia with an annual production capacity of 5m tyres.
Nexen currently operates four tyre plants worldwide, two in South Korea and one in each of China and the Czech Republic. The company was said to be planning to invest US$1.3bn to build a factory in the US with capacity of 31,000 tyres per day or 11m a year.
Nexen aims to select a location by the end of 2023 and start operations in 2028.
The company is also open to the possibility of launching production in the US earlier by acquiring an existing manufacturer or establishing a joint venture if the conditions are right, according to the reports.
The company expects global revenue to rise by 10% to KRW2.85trn (US$2.1bn) in 2023 and generate an operating margin of between 6% and 8%.