Toyo Tire Corp. plans to sell most of its Chinese manufacturing unit as the Japanese tiremaker reorganizes its Asian production footprint while reporting record profits boosted by favorable exchange rates.
The Hyogo-based company will transfer 86% of its stake in Zhangjiagang subsidiary to Chinese investment firm Liaoning Hengdasheng Investment Co., according to a statement Friday. The unit has struggled with “slower-than-expected brand and product recognition” in China’s passenger vehicle tire market since its 2010 establishment.
Operating profit jumped 22% to ¥94 billion ($623 million) in 2024, while revenue rose 2.3% to ¥565.4 billion. The results were driven by successful sales promotion of priority products and the weaker yen, which averaged 151 against the dollar during the period.
The China exit comes as Toyo Tire shifts production for other Asian markets to facilities in Japan and Malaysia. The company’s growth strategy now focuses on North America, where sales grew 4.3% last year to ¥373.1 billion, representing over 65% of total revenue.
“We will continue pursuing flexible and agile business operations in North America and other high-growth markets by promoting optimal allocation of management resources,” said the company in its statement.
For 2025, Toyo Tire forecasts operating profit will decline 9.6% to ¥85 billion, factoring in an expected stronger yen at 146 per dollar. The company plans to raise its annual dividend to ¥125 per share from ¥120.
The results and reorganization news come as Toyo Tire marks its 80th anniversary year. The company’s capital ratio improved to 65.4% from 61.2% a year earlier.
