Cheng Shin Budgets NT$30 B to Boost Tire Output Capacity by 70%

Taipei, Jan. 4, 2011 (CENS)--Cheng Shin Rubber Industry Co., one of Taiwan's leading manufacturers of automobile tires, will budget NT$30 billion, beginning from 2011, to set up three new plants, each one in Chongqing of Sichuan Province and Xiamen of Fujian Province, China, and Doliu of Yunlin County, Taiwan.

Cheng Shin has three plants, one each in Taiwan, Thailand and Kunshan of Jiangsu Province, China. Building three plants will raise Cheng Shin's daily capacity 70% from the existing 100,000 tires to 170,000.

Cheng Shin president J.H. Chen said China is the world's largest production and consumption nation for automobile tires.

The proposed Xiamen plant will roll out Cheng Shin-brand automobile tires to develop China's automobile parts market, with the plant expected to begin mass production sometime in the third quarter of 2011 with daily capacity reaching 26,000 tires.

Cheng Shin has been successful in producing bicycle, motorcycle and truck tires, but not automobile tires, in China, which may change with the inauguration of the proposed Xiamen plant. In the past, Cheng Shin distributed automobile tires with the MAXXIS brand, but will be culturally-savvy in China by using the Cheng Shin brand.

H.M. Wu, vice president of Cheng Shin's finance department, said Cheng Shin will use dual brands in China's automobile market. In the early stage, the company will focus on China's automobile aftermarket by using the Cheng Shin brand, while tap the Shanghai and Kunshan segments with its own MAXXIS brand.

Cheng Shin saw consolidated sales reach close to NT$100 billion in 2010, up 20% year-on-year.