Goodyear President and CEO Richard Kramer, alongside Mexican President Enrique Peña Nieto and several other Mexican government officials, announced Friday that The Goodyear Tire & Rubber Co. will build a new $550 million tire plant in Mexico’s San Luis Potosi state to serve its customers in the Americas.

The plant, which will be operational by 2017, will have an annual capacity of 6 million passenger and light truck/SUV tires in its initial stage.

“This is a proud moment for Goodyear,” Kramer said. “We’ve come together this morning to begin an important chapter in Goodyear’s future.”

The new factory, combined with investments in its existing U.S. and Canadian factories, “will enable Goodyear to meet the strong and growing market demand for high-value-added consumer tires in North America and Latin America,” stated Goodyear in its announcement. Industry demand for high-value-added tires in these regions is expected to increase by 10 million tires per year from 2014 to 2019, the tiremaker said.

Goodyear’s announcement of its investment in Mexico coincides with the 75th anniversary of Goodyear’s presence in Mexico, Kramer said at a press conference at the Los Pinos presidential palace in Mexico City.

Goodyear will break ground on the site of the San Luis Potosi plant in June. Once construction begins, it will take two years to complete. The facility will employ 1,000 employees and incorporate state-of-the-art machinery and equipment. Kramer also noted that the new facility will reflect Goodyear’s commitment to the environment by utilizing natural gas, energy efficient lighting and will receive zero landfill designation.

“San Luis Potosi is an ideal location for the new factory,” Kramer said. “Its central geographic location will enable us to support our valued customers and consumers throughout North America, Mexico and Latin America.”

The new plant will be a “base to support Goodyear’s future growth,” and will help Goodyear “better serve the needs of our customers in both Mexico and the Americas,” Kramer said.

“Goodyear is looking forward to this new facility’s contribution to our success and growth for a long time into the future,” Kramer said.

Goodyear’s new plant follows a string of significant investments in Mexico by major global automakers, including a $1 billion car plant by Toyota, a $2.5 billion engine and transmission facility by Ford, and a $1 billion expansion of Volkswagen’s vehicle assembly plant in Mexico’s pueblo state.

Last year, Goodyear announced its intentions to build a new North American plant.

“Our investment supports another key element of our strategy – to focus on winning with consumers in profitable market segments,” Kramer said last year. “With growing consumer demand for our high-value-added tires in North America and Latin America, the time is right to invest in additional manufacturing capacity in the Americas to maintain Goodyear’s leading position and to grow earnings beyond 2016.

When completed, the new plant would be the tiremaker’s first in North America since its Napanee, Ontario, plant opened in 1990. Goodyear’s last greenfield U.S. plant, located in Lawton, Okla., opened in 1978.

Source: tirereview.com