So far there have been 2 tyre factories who closed their factory doors in Malaysia
We have just heard news that long established Continental Tires will be closing its factory in Kedah (end 2025) which is in the Northern part of Malaysia and they will be retrenching 950 plus employees.
We have not yet gotten the figures of how many more Malaysians in the supply chain have lost their jobs. Logistic, warehousing, raw material supply and maintenance.
When a large manufacturing closes down, other businesses that operate around them will also be affected.
Meanwhile, this factory produces passenger car, light truck, and motorcycle tyres for the Asia Pacific market and also Malaysia.
If you love their tyres, don’t worry as Continental continues to have tyre manufacturing operations in Malaysia through its Petaling Jaya plant, located in Section 51, Selangor and they have a large factory in Rayong Thailand which will be supplying the needed stock for the Malaysian consumers.
So, at its 250 Million Euro Rayong plant, Continental produces premium tires, like the MaxContact MC7 tire and in total produces 4.8 million tires for all segments, including electric vehicles and motorcycle. This factory employs about 900 people.
Also, surprising is that just 6 years ago Continental Tyre opened a new mixing plant in Alor Setar at an investment of RM65 million ringgit.
Incidentally, Continental isn’t the first major tyre maker in recent memory to announce that it is shutting plants over here, with Goodyear previously closing its Shah Alam manufacturing facility late last year. About 550 jobs were lost in that particular plant closure.
Did you know that Goodyear has been selling tyres in Malaysia since 1929… before there even was a Malaysia? Their factory in Shah Alam was established in 1972 and became the company’s first tire plant with ISO 9002 certification in 1992.
So, why did Goodyear and Continental close their factories in Malaysia. It is because of low demand? Can’t be as local assembled cars are still having a good run and in fact with new Chinese automotive brands like Chery and Jaecoo having local assembly, the need for local made tires is needed for added tax incentives from MOF and MARii.
Or is it because of price competition from new tyre manufacturers like China’s Zhaoqing Junhong Corp. Ltd., which does business as Maxtrek Tires. They broke ground on a car and truck tire plant in the Malaysia-China Kuantan Industrial Park in Kuantan in 2019.
The plant, Maxtrek’s first outside of China can produce 6 million car and light truck tires and 500,000 truck/bus tires a year.
There is a also the ‘Fullrun’ tire company that started operations in Klang in late 2018. Operating under the name of GOLDEN HORSE RUBBER Sdn Bhd they produce a variety of vehicle tyres.
Then there is news that Chinese tyre brand ‘Prinx Chengshan’ has disclosed it plans to build a second overseas factory in 2025. The current site is Kedah Rubber City in northern Malaysia.
Also, the ‘Shandong New Continent’ tyre company investment plan in Malaysia was to establish Jiafu Industrial Co., Ltd. in Malaysia and build a radial tyre production plant in 2025.
Now, it is our guess that the cost of manufacturing tyres in Malaysia is getting less competitive for European and American run factories when being challenged by Chinese owned and run factories.
Also, are new automotive brands actually supporting non-Chinese made tyres?
