Nexen Tire invests $1.3 bn to build US factory

South Korea's Nexen Tire Corp. plans to invest $1.3 billion (1.73 trillion won) to build its first-ever factory in the United States. Starting from 2028, the company aims to produce 30,000 tires per day to increase its market share in the local market.

Nexen Tire announced its investment plan for the US factory on Thursday. This will be the company's first manufacturing plant in the United States.

Currently, the company operates four factories, including two in South Korea (Yangsan and Changnyeong, both in South Gyeongsang Province), as well as facilities in the Czech Republic and China. The US factory will be their fifth.

The investment scale is $1.3 billion. The company is considering various locations in eight southeastern states of the United States. Their goal is to select a site by the second half of this year. The factory is planned to start operating between 2028 and 2029, with a production target of 31,200 tires per day.

The company added that they are also exploring the possibility of early factory operations through mergers and acquisitions or joint ventures, depending on market conditions.

Nexen Tire also revealed its business goals for this year. The company aims to achieve sales of 2.85 trillion won ($2.13 billion) and an operating profit of 6-8%. It plans to increase sales by 9.7% compared to last year and turn to the black.

It has also set a medium-term goal of reaching sales of 3.55 trillion won ($2.66 billion) by 2027. Additionally, Nexen Tire plans to expand its supply of tires to more than 250 vehicle models from this year's 118 models of 29 completed car companies by 2027.

Write to Il-Gue Kim at black0419@hankyung.com