By Oliver Hall

Toyo tyres have announced they are establishing a wholly owned subsidiary company in China to cope with growing demand.

Operations will begin at the new plant under the umbrella of the newly established Toyo Tyres Zhangjilagang Co. Ltd.

According to Toyo officials: “This new subsidiary is expected to meet the growing demand for tyres generated by the rapid growth in automobile use in China.”

Toyo is investing around $10 million in the new factory, which is expected to employ around 500 workers, and will manufacture passenger and light truck tyres.

Jiangsu Province is said to be the ideal location to establish the plant because it already has the necessary infrastructure, work force, and logistical support.

Initial production capacity during the first phase will be 2 million units of passenger and light truck tyres.

Toyo previously produced tyres in China in joint ventures with Taiwan’s Cheng Shin Rubber Ind. Co. Ltd./Maxxis International, but it dissolved the ventures in August and shifted its relationship with Cheng Shin to a consignment manufacturing agreement.

That decision allows it to continue to supply customers until its own factory comes on stream.