Sumitomo Rubber Industries plans to increase tyre production capacity in China by over 60% to 100,000 units per day by 2020, according to local reports in Japan.
The company is looking to increase its exposure to fast-growing local demand for passenger vehicle tyres as the country's vehicle parc continues to expand rapidly year after year.
Demand for low-friction, low-noise, fuel-saving tyres is growing particularly strongly.
The reports suggest Sumitomo plans to spend JPY30bn (US$268m) to triple daily tyre production capacity to 60,000 units at its Changsha plant in Hunan province. The new capacity will be highly automated to offset rising labour costs in the country.
The Hunan factory began operations in 2012 and is Sumitomo's second tyre plant in China. The first, in Changsu, Jiangsu province, began making passenger vehicle tyres in 2004 and has capacity of 40,000 tyres per day.
The company also plans to expand its Dunlop retail tyre network in China by 10% to 7,000 outlets in the next two years, focusing mostly on the less developed inland provinces.