Pirelli plans to invest $200 million in China and make the market its biggest manufacturing center by 2014.
According to Gregorio Borgo, CEO of Pirelli Asia Pacific, this expansion is of utmost importance for the company to keep pace with the huge potential for tire market due to the increasing demand for luxury vehicles and SUVs in China.
“By 2014, our manufacturing base in Yanzhou, Shandong province, the only one in Asia-Pacific, will become the biggest in the world for Pirelli,” said Gregorio Borgo. “From 2012 to 2014, we are investing around $200 million in China, the world’s largest vehicle market.”
In 2011 Pirelli announced a turnover of $468.4 million in Asia Pacific and it predicts a 23% year-on-year growth for 2012, due to increased demand for expensive vehicles in China. The company’s Yanzhou plant was established in 2005, beginning with truck tires production. Two years later the company added a passenger tire production line, with a 5 million units annual capacity.
“The Asia-Pacific market contributes 7 percent of our global turnover, and we are targeting to increase that. We hope to double that production capacity of passenger car tires to 10 million by the end of 2014,” added Borgo.