Michelin Plans to Expand Capacity at Two China Plants

France's Michelin Group plans to boost output at its two plants in China in response to capacity expansion moves by rivals such as Bridgestone Corp, the Shanghai Youth Daily reported. The newspaper said Michelin would the boost output at its plant in Shenyang in northeastern China to two to three million units a year.

From AFX News Limited

SHANGHAI — France’s Michelin Group plans to boost output at its two plants in China in response to capacity expansion moves by rivals such as Bridgestone Corp, the Shanghai Youth Daily reported.

The newspaper said Michelin would the boost output at its plant in Shenyang in northeastern China to two to three million units a year. It did not give the current level or say when the new levels would be reached but it quoted Ge Lipu, general manager of Michelin Shenyang Tire Co, as saying that the capacity increase has been approved by headquarters in France.

Ge said the French tire maker also aims to expand annual capacity of Shanghai Michelin Warrior Tire Co, its joint venture with Shanghai Tyre and Rubber Co Ltd., to 14 million units. It did not give current output or other details.

An official at Michelin China said she was unable to confirm the report.

v Ge said the Shenyang plant will produce Michelin branded tires, and the Shanghai plant will mainly focus on manufacturing Warrior branded tires, which are aimed at the medium and low-end segment of the market.

Michelin Shenyang Tire was Michelin’s first Chinese joint venture, and was set up in 1995 with a total investment of $150 million the French company said on its Web site.

In 2001, Shanghai Tyre and Rubber Co. and Michelin jointly invested $200 million in Shanghai Michelin Warrior Tire Co.

Earlier this year, the Wall Street Journal reported that Michelin is also looking for a third factory in other Chinese cities.

Its rival Bridgestone has two tire plants in Shenyang and Tianjin, and plans to build another in east China’s Jiangsu province, according to the China Economy Times.

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