. Last Updated: 07/27/2016

Continental Puts $30M in Tire JV

No. 1 German tiremaker Continental announced Monday that it will invest 30 million euros ($29.6 million) into its joint venture with the Moscow Tire Plant.

The two companies are installing equipment at the Moscow plant and plan to produce 1.5 million tires per year by next fall and push output to 3.4 million by 2006, Continental said in a statement.

Continental could not say when production would begin. Moscow Tire Plant general director Vladimir Yezhov and Continental chairman Manfred Wennemer are expected to release more details about the project Wednesday.

Continental -- which had sales of 11.2 billion euros in 2001 -- created the joint venture with the city-owned Moscow Tire Plant in September. Continental said it is the majority holder, but declined to reveal the size of its stake.

Continental has been in on-and-off talks to open a local facility with the Moscow Tire Plant and other Russian tire producers since 1998. Continental has promised investments of up to $43 million and production of up to 5 million tires per year, but talks have dragged.

Continental is not alone in setting up local tire production as companies seek to avoid high import tariffs.

France's Michelin is building a multimillion-dollar facility in the Moscow region, while Bridgestone of the United States is producing tires with Russia's Amtel Holding Co. Finland's Nokian had planned to produce 200,000 tires in Russia this year through a deal with Amtel, but no investment has been made.