On January 27, Sailun Tire issued an announcement to adjust the investment plan for its Indonesian production base project, raising the total investment from 251.44 million US dollars to 299.74 million US dollars, optimizing the production capacity planning simultaneously and increasing the layout of the overseas market.
It is reported that after the adjustment, the project will have an annual output of 6 million semi-steel radial tires, 750,000 all-steel radial tires, 10,000 tons of off-the-road tires and 1.5 million sets of inner tubes and flap belts. The production capacity of semi-steel tires will be greatly increased compared with the original plan. The project focuses on the markets of Indonesia and surrounding countries, and expands regional coverage by virtue of local resource and logistics advantages.
To ensure the progress of the project, Sailun Tire has formulated a capital increase path for three-level subsidiaries with a total capital increase of no more than 55 million US dollars. Capital will be injected into Sailun Indonesia, the project entity, through Sailun Hong Kong and Sailun Singapore. After the capital increase, the registered capital of the relevant subsidiaries will be raised and the equity structure will remain stable.
As the first domestic tire enterprise to build a factory overseas, Sailun Tire has mature overseas operation experience. The project is expected to achieve an average annual revenue of 335.31 million US dollars and a net profit of 62.55 million US dollars. After putting into production, it will enhance customer attraction and drive the growth of production and sales volume.
At present, the global demand for tires is growing, the industry differentiation is intensifying, overseas leading enterprises are adopting contraction strategies, and domestic enterprises are accelerating their overseas expansion. Sailun Tire's capacity expansion this time conforms to the trend. Relying on Indonesian resources, it reduces costs and increases efficiency, avoids trade barriers, further improves the global production capacity matrix, and is expected to increase its market share in the industry restructuring.
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