Groupe Michelin and PT Petrokimia Butadiene Indonesia (PBI) have signed an agreement to create a joint venture company to produce synthetic rubber for The synthetic rubber plant will be the first in Indonesia and will produce feedstock for environmentally friendly tires.
Ownership of the new company will be broken down as follows: 55% Michelin, 45% PBI. The total Investment is estimated at $435 million.
Pending the final investment decision, plant construction is expected to begin in early 2015, with completion and start-up targeted for the beginning of 2017.
"In line with high growth of (the) auto industry in new emerged countries and the global trend towards more performance requirement from tires, i.e. tires which are safer, last longer and deliver fuel savings, the demand for more technological synthetic rubber are forecast to increase as these are necessary to deliver more performances in a single tire and be at the same time environmentally friendly," said Michelin in its press release announcing the joint venture.
The partnership will bring "significant synergies and create value both for the Indonesian and South East Asian markets."
PBI is a subsidiary of PT Chandra Asri Petrochemical Tbk, the largest vertically integrated petrochemical company in Indonesia.
The joint venture is part of the realignment of Michelin's global tire manufacturing. For more information, check out these links: