State, already the top U.S. producer, adds plants

Tire makers roll into South Carolina

State, already the top U.S. producer, adds plants

Continental Tire's new plant in Sumter, S.C.
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South Carolina is cementing its reputation as North America's tire capital.

Five tire plants have opened or are in the works in that state, as suppliers race to alleviate a tire shortage in North America's booming automotive market.

South Carolina became the nation's leading tire producer in the fourth quarter last year with estimated daily output of 89,000 tires, edging Oklahoma's 88,000 units, according to Tire Business, a sibling publication of Automotive News.

Ohio, home of historic tire center Akron, is No. 12 on the list at 23,900 tires per day.

The fresh wave of tire makers' investments in South Carolina:

•  In June, the Giti Tire Group of Singapore announced plans to build a $560 million plant in Chester County to make tires for original equipment and the aftermarket.

• In May, Trelleborg Wheel Systems disclosed plans to spend $50 million on an operation in Spartanburg County to produce tires for farm equipment.

• In January, Continental Tire opened a $500 million tire plant in Sumter to produce passenger vehicle tires for original equipment and the aftermarket.

• In December, Michelin dedicated a plant in Anderson County that will produce tires for earth-moving equipment. That project, along with an expansion of its Lexington tire factory, cost $750 million.

•  Bridgestone spent $1.2 billion to expand its passenger tire plant in Aiken and construct a factory to produce tires for mining vehicles.

The Giti project is the company's first North American tire plant. Although Giti is headquartered in Singapore, seven of its tire plants are in China and an eighth is in Indonesia. Tire Business ranks Giti as the world's 11th-largest tire maker.

Company executives could not be reached for comment.

In South Carolina, Giti will be neighbors with three giants -- Continental Tire, Bridgestone and Michelin -- another indication of the state's growing importance in the tire industry.

"Clearly the state is well on its way to become a very important player in the tire industry," said Jochen Etzel, CEO of Continental Tire the Americas.

Continental chose to build its plant in South Carolina because of the state's deep-water port in Charleston, its business-friendly climate and its proximity to the supplier's customers.

"We have a lot of business along the East Coast," Etzel said. "We want to be close to our customers."

The port of Charleston has proved useful. During construction, Continental shipped machinery through the port, and it may export small volumes of truck tires.

The port also provides an alternative route for rubber shipments. "We may not bring our raw materials through Charleston, but to have it as an option is very important," Etzel said.

Another key factor, which Etzel declined to discuss, was the state's financial generosity. According to news reports, Gov. Nikki Haley earmarked a $31 million grant to Continental for its plant. Intangibles played a role, too. Etzel says state officials have had considerable experience working with German manufacturers. A major BMW assembly complex, with suppliers, is in Spartanburg, S.C.

"We could tell they understood how German companies typically work -- the decision-making process," Etzel said. "We had numerous occasions when it turned out to be very helpful."

You can reach David Sedgwick at dsedgwick@crain.com.


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