The opening of the new plant, which operates as Hubei Linglong Tire Co. Ltd., represents a “major milestone” in the company’s growth plan.

JINGMEN, China—Shandong Linglong Tire Co. Ltd. has initiated production of radial truck and bus tires at its newest factory, 18 months after the company broke ground on the 7.2 million-sq.-ft. factory.

The new plant, located in Jingmen, is Linglong's fourth in China, has rated annual capacities of 12 million radial passenger tires, 2.4 million radial truck/bus tires and 600,000 off-the-road tires, the company said.

The opening of this plant, which operates as Hubei Linglong Tire Co. Ltd., represents a "major milestone" in the company's growth plan. At full production, the new subsidiary is expected to generate over $700 million in annual sales, Linglong said, without disclosing a timeline for the production ramp-up.

Linglong budgeted $875 million for the project.

Linglong is considered China's second largest tire maker and 17th largest worldwide, based on fiscal 2018 sales of $2.32 billion, according to Rubber & Plastics News' Global Tire Report.

The manufacturing base will integrate intelligent manufacturing, PLM (product lifecycle management), industrial big data application and high-end brand, Linglong said.

Helping the company overcome "regional restriction," Linglong said that the new location will serve customers "at zero distance, improve market share and reduce logistics cost."

In 2017, Linglong moved to a "5+3" strategy, with plans to build the fourth manufacturing base in Jingmen and increase its international locations to three.

The company opened a plant in Thailand in 2014 and is building its second overseas unit in Serbia to serve the European market, while also mulling a plant in the U.S. as its third overseas factory.