Hankook expands supply to premium automakers

Korean manufacturer Hankook Tire said that it is expanding its premium-class tires to the world's premium automakers.

Last year, Hankook signed an agreement on the supply of primary tires for SUVs and the Mercedes-Benz GLC-class coupe.

The selected Ventus S1 evo2 SUV tires are manufactured at the Hungarian Tank Plant; They will be delivered to the plant of the automaker in Bremen.

Now, Hankook Tire, which ranks seventh in the list of the world's leading manufacturers, delivers tires for the initial assembly of many advanced models from leading automotive companies such as BMW, Mercedes-Benz, Nissan Motor and Ford Motor Co.

It is believed that tire companies do not earn a lot of money on supplies of primary equipment, but due to this they improve the brand image and its recognition among consumers. This often leads to a higher demand for brand tires with high added value in the replacement market, so manufacturers are eager to supply tires for the factory equipment of premium and luxury cars to confirm the quality of their products.

In the global tire markets, products manufactured by Hankook and Kumho Tire are still considered second-rate, despite the confirmed high quality, and the top-class suppliers remain Michelin, Pirelli Tire, Continental Tire and Goodyear Tire & Rubber. Of course, the Koreans are trying to overcome the existing stereotypes.

70% of Hankook Tire's profits account for tire sales in the replacement market, and the remaining 30% for sales in the primary segment. In 2016, in general, the net profit of the Korean manufacturer increased by 34%, to $ 790 million, and the production profit increased by 25%.

Over the past year, seven Hankook Tire plants have produced 99 million tires. The company's eighth plant is currently being built in Tennessee, USA, and its initial production capacity will be 5.5 million tires per year.

Since 2018, Hankook expects to produce about 105 million tires annually.