Hankook in talks with Hungary
Tuesday, October 18, 2005, 11:19
Hankook Tire Co., South Korea's largest tiremaker, said it was considering the Czech Republic, Hungary and Poland as possible site for building a $600 mln factory, after dropping Slovakia from consideration, business daily Világgazdaság reported. Hankook will probably pick Hungary, the paper said relying on unnamed sources.
Hankook in May chose Levice, about 130 kilometers from the Slovakian capital Bratislava, as the site for its first factory in Europe. The plan was disrupted after Slovakia's lawmakers rejected 2 bln koruna ($62 mln) of aid and tax breaks for the factory, which would have created 1,600 jobs by 2008. Hankook, which also has factories in China, wants to expand overseas production to Eastern Europe to supply Kia Motors Corp. and France's PSA Peugeot Citroen, taking advantage of lower taxes and cheaper labor costs. Kia, South Korea's second-biggest carmaker, is building a 1.1 bln factory to produce 300,000 vehicles a year in Slovakia. Hankook's shares fell 0.7% in Seoul today. The shares have increased 35% this year compared with a 32% rise in the main Korean stock index.