Published : 2013-09-01 09:39
Updated : 2013-09-01 09:39
The head of Kumho Tire Co. has said his company is seeking to complete construction of its suspended plant in the United States, a move that could give South Korea's second-biggest tire maker a foothold in the world's second-largest auto market.
Kumho Tire broke ground for its first plant in the U.S. state of Georgia in 2009, but the construction has since been stalled as creditors placed the key affiliate of Kumho Asiana Group under a debt workout scheme to help the country's 14th-biggest business group ease a liquidity squeeze.
Kim Chang-kyu, president and CEO of Kumho Tire, said his company could resume the construction of the plant, citing a possible expansion of assembly lines of Hyundai Motor Co. and its smaller sister company Kia Motors Corp. in Alabama and Georgia, respectively.
Hyundai and Kia, which together form the world's fifth-largest carmaker, each have an annual production capacity of 360,000 units in the U.S.
"We are clearly committed to entering the U.S.," Kim said Friday in his first meeting with reporters since assuming his post in 2012. He made the comment ahead of an official opening ceremony of the company's new research and development center in Yongin, just south of Seoul.
Still, he did not give a specific time frame on when to resume the construction of the plant.
Currently, the decision to restart the stalled project depends on creditors as the world's 12th-largest tire maker by sales is under the debt rescheduling program, according to the company.
Kim said his company is sparing no effort to quickly end the debt workout scheme.
The U.S. plant, if built, could save time and costs for Kumho Tire in providing tires to Hyundai and Kia in the U.S. as well as American consumers.
Currently, Kumho Tire ships its products made in South Korea, China and Vietnam to the U.S., according to Shin Yong-sik, executive vice president in charge of marketing and logistics.
Kumho has an annual capacity of 65 million tires in its three plants in South Korea, four plants in China and one plant in Vietnam. (Yonhap news)