Yokohama Rubber has recently signed a contract to build a commercial truck tire plant in the US, as the company expects a global supply shortage of tires.
Yokohama will invest $300 million to build the plant located n West Point, Mississippi, and hire 500 workers in a first phase. During the nest phase the company will invest $1.2 billion and hire 2,000 more workers. The local government will offer $340 million in aid and tax breaks.
The company’s CEO Takayuki Hamaya said that construction will begin in September and production is expected to start in October 2015. Currently Yokohama manufactures tires for trucks and passenger vehicles in Salem, Virginia and at a JV plant in Mount Vernon, Illinois.
“By looking at what demand is worldwide, we definitely see a shortage of supply,” Hamaya said.
Since the yen gained ground against the dollar many Japanese companies have turned their attention to the US, increasing production in the region. Yokohama’s Mississippi plant is the company’s latest expansion, after the tire producer announced plans to increase capacity at its plants in Thailand, the Philippines and Russia. Yokohama is also considering building new factories in Latin America, India and China.