Tire Exports Reach Record Level
- Likely to hit around $2 bln this year by three tire makers

Amid sluggish domestic economy, exports of tires have been rising this year. Exports of tires and tubes amounted to $1.4 billion during January to August this year, up 18.6 percent, the Ministry of Commerce, Industry and Energy(MOCIE) said Oct.1.

MOCIE said tire exports are likely to maintain their current pace into the second half totaling $2 billion for the year.

Yoon Soo-young, director of Textile, Fashion Apparel & consumer Goods Industries Division at MOCIE, attributed the good performance to the restructuring of three major tire makers and stable labor-management relations and the launch of the sale of high value-added tires.

Hankook Tire Co. concluded a strategic  tie-up with Michelin, the top tire maker in the world, in June last year in a bid to strengthen its overseas marketing by propping up its distribution network.

Kumho Tire Co. became an independent corporation following its separation from its parent group in July and the company made substantial investments in its marketing and R&D sectors.

Nexen Tire sold off unprofitable units and focused on the production of radial tires following its restructuring.

UBS predicted that the sale of Hankook Tire is projected to increase 5 percent this year with the average price of tire rising 7 percent. Earnings per share is projected to record 24 percent next year. EPS for this year is projected at 49 percent.

Hankook Tire was established in May of 1941 as Chosun Tire Industrial Co. It launched the production of its tire from its plant in Yondungpo, Seoul, in 1942. The company began to export its tires in 1962. It went public in 1968 by listing its shares with the Korea Stock Exchange. The company opened its Daejon plant in 1979. It won the $100 million Export Tower Medal from the government for exporting $100 million worth of tires in 1980. Fifteen years later, the company captured the $500 million Export Tower Medal in 1995. Last year, the company became the first tiremaker to export $700 million worth of tires in a single year.

Kumho Tire plans to set up its second plant in China in Tianjin and its plants in Nanjin and Tianjin would be expanded to turnout 18 million pieces of tire in 2007. Kumho's new plant will produce 5 million pieces of tire a year. It signed a memorandum of understanding(MOU) with its Chinese partner, the Tianjin Economic Technology Institute. Kumho will invest $185 million in the projected plant, which will be designed to turnout tires for luxurious sedans.

The company plans to expand its Nanjin plant capacity to 12 million pieces per year next year from 6.8 million now. The company expects to be a leading tire maker in China when its Tianjin plant becomes operational in 2007.

Kumho's first plant in China in Nanjin became profitable in three years following its establishment in 1996 and this year, the plant plans to record 205 billion won in sales revenue and 22 billion won in net profit.

Nexen Tire took over the Michelin Korea Tire Co. in 1991. The company has been making efforts to meet all kinds of diversified demands by its customers since its launching. In meeting those goals, detailed and realistic planning has been part of its operation. Management of the company has always been guided by the idea that its strategies must be precise enough to move its customers with the highest-quality product and best services. Management also stresses speedy actions to stay a step ahead of its competitors in this age of unlimited competition. Speedy actions for a speedy growth of the company, the company stresses.

Nexen also pushes reliability in its management goals, saying that speedy actions should arouse reliability in its customers, which will help continuous growth of the company.

High technology level is the key to every company strategy to move ahead, the company believes. Thus company will make every effort to raise its technology level to stay competitive in its operations in the 21st century.   nw