Published Oct. 23, 2013
CLARKSVILLE, Tenn. — Hankook Tire Co.’s decision to build its first U.S. tire plant in Montgomery County near the Kentucky border offered a much-needed economic boost for the region.
The South Korean tiremaker’s announcement came just months after Hemlock Semiconductor decided to lay off 300 people and mothball its $1.2 billion polysilicon plant, which was nearly finished.
|Tennessee Gov. Bill Haslam (left) joins Hankook Tire Co. CEO Seung Hwa (right) during a news conference about the company’s decision to build an $800 million production plant in Clarksville, Tenn. (Photo/Tennessee Department of Economic and Community Development)|
In January, Michigan-based Hemlock said an oversupply in the polysilicon industry and threat of tariffs on products sold to China would delay opening the Clarksville plant.
Hankook had been shopping for a site in the Southeast for a number of months, evaluating hundreds of possible locations. In September, the company said it had trimmed its list of prospects to three states — Tennessee, Georgia and South Carolina — but did not disclose how many sites were under consideration.
On Oct. 14, some 2,000 local and state officials were on hand at the Wilma Rudolph Event Center in Clarksville to hear Hankook say it would invest $800 million in a new plant and eventually hire about 1,800 full-time workers.
The plant, which will be Hankook’s eighth production facility, should begin producing tires for cars and light trucks by 2016. The plant is projected to have an initial capacity of about 6 million tires annually.
“As our brand continues to gain recognition in the United States and demand for our industry-leading tire products continues to grow here, establishing a manufacturing facility in the U.S. further demonstrates our commitment to delivering high-quality products and service to the market, and is the next natural phase for our continued growth,” said Seung Hwa Suh, vice chairman and CEO of Hankook Tire.
After thanking Hankook for its investment, Tennessee Gov. Bill Haslam noted that the auto sector is a key industry cluster in the Volunteer State, with more than 910 auto suppliers and manufacturers.
Tennessee’s automotive sector also is the largest in the South in terms of employment, providing jobs for 113,000 workers and representing an investment of $31.5 billion.
The sector led Tennessee’s post-recession economic recovery, generating more than 12% of the state’s job creation since the recession and more than one-third of the manufacturing sector’s output growth since 2010.
Becoming the largest tenant at the Clarksville-Montgomery County Corporate Business Park, Hankook Tire plans to build its facility on 469 acres over the next few years. Construction is scheduled to begin in 2014 and will result in a 1.5 million-square-foot manufacturing facility to produce high-end performance tires.
Hankook wanted a location in the Southeast to supply some of its largest customers, including Hyundai Motor Co. and Kia Motors Corp., which have plants in Alabama and Georgia, respectively.
The Clarksville location offers Hankook a transportation network that includes rail, air, interstate highways and access to the Mississippi River inland waterway, the company said.
“This announcement puts Hankook Tire one step closer to its vision of being a leading global tire company providing customers with top-tier products and service,” the company said.
Hankook is among several tire makers expanding in the U.S. as North American auto manufacturing goes through the fastest expansion since 1950, according to Morgan Stanley. The bank expects 2013 sales to reach 16.7 million vehicles and 2015 sales could reach 18 million.