CLARKSVILLE, Tennessee — At the Hankook Tire plant in Clarksville early this month, construction workers were installing the steel frameworks of its second factory. It is an identical twin to the first plant completed in 2017 at the location in terms of appearance and size.
Hankook Tire & Technology Co., South Korea’s largest tire maker and one of the world’s top 10 tire brands, will spend a total of $1.6 billion into the new facility in Clarksville, about 70 km northwest of Nashville, the capital city of Tennessee.
Upon completion of the new plant, it will double its US production to 12 million units by 2026 from 550,000 units in 2024.
It is a timely investment in the US territory as its peers operating plants in Mexico and Canada are likely to face a 25% tariff under Donald Trump’s administration that kicks off on Jan. 20.
ZC Rubber, China’s largest tire maker, is building a plant in northern Mexico after breaking its ground in 2024. It earmarked $500 million for the construction.
Taiwan’s Sailun Group, ranked around 20th in the global tire market, completed a factory in Mexico in 2023 with an investment of $240 million to produce 6 million units of tires annually.
According to the US Tire Manufacturers Association, a total of 57 tire factories are in operation across the US. A majority of them are outdated with over 20 years in operation.
Their annual output is 3 million units on average, a one-fourth of Hankook Tire’s 12 million units upon completion of its second factory in Tennessee in 2026.
Tires to be manufactured there will be delivered to nine carmakers, including Hyundai Motor Co., Kia Corp. and Toyota Motor Co., which operate plants in Alabama, Georgia and Kentucky, respectively. Tennessee borders the three states.
From 2026, Hankook Tire will churn out products in 35 different sizes. Currently, it products come in 20 different sizes customized to six carmakers.
“Next year, the number of vehicle models equipped with Hankook tires will reach around 250, doubling the current number,” said Choi Intae, president of Hankook Tire America Corp.
Including the warehouse, the site of its production complex in Clarksville, Tennessee covers 1.89 million square meters.
The new facility will be a smart factory, incorporating the same artificial intelligence-powered robotic arms and automated guided vehicles used in the first plant.
But its aggressive US investment carries risks. Trump administration’s universal tariffs on imports, pledged by his transition team, could lead to a price rise in raw materials such as natural rubber shipped to the country and result in longer tire replacement cycles.
By Jin-Won Kim
Jin1@hankyung.com
Yeonhee Kim edited this article.
