Sailun Set to Establish Its First Tire Manufacturing Plant in North America

Sailun Group has significantly expanded its investment plan for the construction of a tire manufacturing plant in León, located in the central Mexican state of Guanajuato, through a joint venture (JV) with Mexico's TD International Holding. This marks Sailun's inaugural production facility in North America, reflecting the company's strategic move to enhance its global manufacturing footprint. The project, anticipated to cost $240 million, is expected to be completed within a 12-month timeframe, according to a filing made by Sailun on December 16.

The primary focus of the new manufacturing plant will be the production of semi-steel radial passenger car tires, with an initial annual capacity of 6 million units. Sailun aims to strengthen its position in the passenger car tire market through this venture. Additionally, the JV partners, Sailun and TD International Holding, have plans to explore the production of all-steel truck and bus radial tires in the future, with a targeted annual capacity of 1.65 million units.

The joint venture, aptly named SL & TD Tire Manufacturing, will be predominantly owned by Sailun, with its Singapore subsidiary holding a 51% stake. TD Mexico, a local enterprise, will own the remaining 49% of the JV. Sailun will play a pivotal role in supporting the project by overseeing construction, equipment installation, and production aspects. On the other hand, TD Mexico will contribute by providing administrative support, managing processes, and maintaining external relationships. Additionally, TD Mexico's subsidiary, Tire Direct, touted as the largest tire dealer in Mexico, will be actively involved in supporting the venture.

Sailun envisions this strategic move as a means to offer faster and improved market services to customers in North America. By establishing a local manufacturing presence, Sailun aims to enhance its customer base in the region. The investment in the Mexican plant aligns with Sailun's broader objectives of navigating international trade barriers effectively, enhancing competitiveness, and capturing a larger share of the market.

The project is part of Sailun's global expansion strategy, and the company anticipates that the establishment of its first production facility in North America will fortify its position in the tire manufacturing industry. The increased production capacity and proximity to the North American market are expected to contribute to Sailun's ability to respond promptly to market demands and changes. This strategic move positions Sailun to adapt to evolving market dynamics, mitigate trade-related challenges, and solidify its standing as a key player in the global tire manufacturing landscape.