Hankook Tire seeks to evolve beyond tires, auto parts

Hankook & Company Co., the holding company of Hankook Tire & Technology Co., will ramp up battery production for energy storage systems and robots, alongside absorbent glass mat (AGM) batteries used for combustion engines and hybrid cars.

It is also exploring investments in mobility platforms, precision machines and data center thermal management technology to expand beyond tires and automotive parts.

In an exclusive interview with The Korea Economic Daily on Tuesday, Park Jongho, CEO of Hankook & Company, said he is targeting startups, which can create synergy with its existing businesses, after completing a string of large-scale M&As over the past few years.

“We’ll establish a corporate venture capital arm, focusing on investing in promising startups rather than pursuing large-scale M&As," he said. “We’re looking for strategic and financial investments.”

The interview was conducted after the tire manufacturer purchased a controlling stake in Hanon Systems Corp., the world’s second-largest heat pump system maker for automobiles, for 1.37 trillion won ($943 million).

Park, a certified public accountant, pledged to turn Hanon Systems around within the next three years from the loss of 334.4 billion won in 2023 amid a slowdown in EV demand.

"Hanon Systems was formed through the merger of three companies: Halla Climate Control, Ford's subsidiary Visteon and Canada’s Magna International. But its integration was not seamless, resulting in inefficiencies,” said the former senior official at the Ministry of Economy and the National Tax Service.

Visteon, formerly a part of Ford, manufactures vehicle cockpit electronics and electrification components. Magna International is an automobile parts maker.

Park is considering restructuring Hanon’s 53 factories across 21 countries. Previously, he led LG Electronics Inc.'s financial planning team as the company’s then-youngest executive.

As part of the efforts to diversify beyond its tire-heavy portfolio, Hankook & Company took over AtlasBX’s lead-acid battery ES business in 2021. The division produces absorbent glass mat (AGM) batteries designed to prevent acid spills and minimize water loss during use.

In 2022, the tire maker acquired a stake in Canada-based PMC, a manufacturer of mechanical insulation components for commercial and industrial systems.

Write to Jung-Eun Shin at newyearis@hankyung.com
 

Yeonhee Kim edited this article.