Kumho Tire to invest $750 million in first European factory

Industry

Published: 18 Mar. 2024, 17:24

Kumho Tire to invest $750 million in first European factory

Kumho Tire CEO Jung Il-taik poses for a photo with its EV-dedicated EnnoV tire. [KUMHO TIRE]

Kumho Tire is considering building its first European factory in 2027 to capitalize on the fast-growing EV market.

The investment will reportedly exceed 1 trillion won ($750 million), according to local media reports, with a goal of breaking ground next year and finishing construction in two years.

The potential countries are Romania, Serbia, Portugal and Turkey, the reports said.

A poster for Kumho Tire's EV-dedicated EnnoV tires [KUMHO TIRE]

"We are finalizing the location out of four candidates," said Kumho Tire CEO Jung Il-taik during a press event on Friday. "Our plant's capacity will start at some 6 million units, and will ultimately expand to 12 million."

As of last year, a quarter of Kumho's sales came from markets in Europe. The company operates eight factories in four countries: Korea, China, the United States and Vietnam. It currently supplies tires to various European carmaker groups, including Stellantis and Volkswagen, but those products are currently made in Vietnam.

Kumho Tire also introduced the EnnoV, an EV-dedicated tire, to maximize sales in the fast-growing EV market.

The tires are designed to deliver a quieter ride, reducing noise by 6 percent compared to the previous product, Kumho said.

The tire manufacturer is aiming to sell up to 150,000 EnnoV tires this year.

Jung predicted that EV-dedicated tire sales would make up to 35 percent of Kumho's total sales, a fivefold jump from last year's 7 percent.

"EnnoV is Kumho Tire's innovative product developed with expertise in EVs," Jung said. "EnnoV will be the foothold that makes Kumho a premium tire brand."

The company aims to log an all-time high of 4.5 trillion won in revenue this year by targeting various high-end car brands.

The European tire market, which was valued at $68.4 billion last year, is forecast to reach $108.7 billion in 2033, according to market tracker Future Market Insights.

BY SARAH CHEA [chea.sarah@joongang.co.kr]