Kumho Tire is moving forward with plans to establish a European production facility as the Korean tire maker navigates challenges posed by hefty US tariffs on Asian-made tires. CEO Jung Il-taek confirmed the company is in active negotiations with Poland, Serbia, and Portugal as potential locations for the plant.
Trump’s administration imposed a 25% tariff on automotive parts, including tires, starting April 3, significantly impacting Korean manufacturers who rely heavily on Southeast Asian production bases for US exports. For Kumho, the tariff impact is particularly severe as 95% of its exports to the US are manufactured in Vietnam, previously subject to only a 7.89% tariff.
The planned European facility, requiring an investment between 800 billion and 900 billion won ($545-613 million), aims to produce 6 million tires annually in its first phase. This strategic shift comes after Kumho recorded its highest-ever financial performance, with 2024 consolidated sales of 4.53 trillion won ($3.1 billion) and operating profit of 588.6 billion won.
Kumho is simultaneously reinforcing its premium product strategy with three new high-performance ECSTA lines that have received top ratings from European testing agencies. The company is also preparing for electric vehicle demand with innovations including noise reduction technology.
“We are currently reorganizing our portfolio to focus on high-profit products for the US market,” Jung noted at the press conference. The company has secured additional land near its Georgia plant for potential US expansion if trade conditions deteriorate further.
