AKRON, USA - Tire companies collectively budgeted nearly $1.6 billion in the past year for worldwide expansion, according to company announcements made during the past 12 months.
The more than 30 individual projects announced since August 1999 represent a cumulative increase in annual global capacity of 23 million to 28 million units in the next two to three years.
This output comes on top of about 15 million units of capacity added in the past year.
At the same time, though, plant closings in the past year took more than 10 million units of annual production out of circulation.
Pirelli SpA announced the largest investment package, committing up to $500 million in the next few years to build five or six plants based on its Modular Integrated Robotic System.
The first such unit opened this summer in Milan, Italy, and a site for a US plant is being evaluated.
The facilities represent new capacity of up to 10 million high-performance tires a year, depending on the final configuration of the plants, Pirelli said.
Bridgestone Corp. also continued to invest in new capacity, buying a second factory in China, budgeting $100 million for expansions and improvements in Brazil, and expanding its still relatively new plants in Aiken, USA, and Indore, India.
After budgeting at least $400 million in 1999 for new and expanded facilities in North America over a five-year period, Groupe Michelin turned its attention to Asia.
It committed, along with a joint venture partner, $100 million to expand capacity in Thailand; budgeted $115 million for a new plant in India; and is in advanced negotiations with Shanghai Tyre & Rubber Co. to create a joint venture in China.
While Goodyear has a few projects under way, a large share of its capital spending is directed at integrating Dunlop activities in North America and Europe into its manufacturing and distribution network.