Kenda says ‘No’ to status quo
To Jimmy Yang, vice-chairman of Kenda Rubber Ind. Co. Ltd., status quo is unacceptable. The 52-year-old company was already one of the largest producers of specialty tires in the world when it began manufacturing passenger tires in 2001.
It was only a matter of time before the Taiwanese company entered the radial truck tire market.
“We are always looking to continue to grow our global business by adding to our existing bread-and-butter items like bicycle tires, lawn and garden tires, trailer tires, golf cart tires, motorcycle tires and industrial tires,” says Yang, who also serves as president of American Kenda Rubber Industrial Co. Ltd.
Last month, in the first of our exclusive, two-part interview with Yang at Kenda USA headquarters in Reynoldsburg, Ohio, he revealed plans for a truck and bus tire plant near Shanghai, China. The facility is expected to begin producing truck tires in three years.
For now, however, consumer tires are a priority. Kenda has the capacity to produce 35,000 passenger and light truck tires a day from its three Asian plants. That’s not enough, according to Yang.
MTD: Do you have the ability to increase radial passenger and light truck (PCR) tire production at your existing plants?
Yang: Yes. The three PCR plants only produce 10 million tires a year. That includes our plant in Taiwan. The Tianjin, China, plant can grow from 5,000 tires a day into 25,000 by adding equipment. The Kunshan, China, plant can grow from 22,000 to 40,000. Our other plant in China, in Shenzhen, does not make radial tires at the moment, but our game plan is to relocate the plant and add radial tire capacity to it. We also are in the process of evaluating whether or not to add PCR capacity to the bias-tire factory in Vietnam, either by expanding existing capacity or moving the plant.
We could grow from 10 million tires a year to 30 million, so the growth potential for Kenda is great. But even 30 million is still small compared to a company like Hankook.
MTD: The U.S. represents about 25% of your PCR business. Will the company ever build a consumer tire plant here?
Yang: It’s not on my radar screen yet, but I would not say never. Kenda already possesses manufacturing experience in America. We have been making trailer tire wheels here since 1998, and have trailer tire and wheel assembly plants in Blackshear, Ga.; York, Pa.; and Elkhart, Ind.
I recently expanded my York operation by buying a 120,000-square-foot warehouse. So to come into states and set up PCR or truck and bus tire manufacturing in the foreseeable future is possible. I would not rule out that possibility.
MTD: What is your biggest challenge in the U.S.?
Yang: Improving the brand image. The Kenda brand is very strong in the specialty tire market, which has helped our PCR products. But we are still regarded by the consumers as the new kids on the block. There is some brand awareness, but still nowhere near what I want.
Although I do have manufacturing in China, this is a Taiwanese brand, so our marketing slogan is “Kenda is a world-class brand coming from Taiwan.”
Kenda is very actively involved in the marketing promotions area. Kenda used to sponsor Ben Curtis, who won the British Open, and now we are associating with another golfer, Chad Campbell.
We also sponsor two Taiwanese women golfers on the LPGA Tour.
MTD: Do you hope to have OE consumer tire contracts in North America one day?
Yang: Yes. We already have the Honda Acura temporary spare tire contract in the U.S. Kenda is actively looking to participate in any of the OE opportunities globally. In order to grow our PCR business, in order to grow the brand image and increase the volume, we knew we had to be in the OE business as well. It is easier to do that in China and Taiwan, the two home markets for Kenda.
We have supplied Shanghai GM for the last three years with the Kenda Komet (KR23). Although it’s only one model, it’s a good beginning. We also have a couple of other projects in progress in China. ■