Kumho Tire Co., Inc. Business Report FY ended Dec. 2019
Financial Overview (Consolidated) |
(in millions of won) |
| FY ended Dec. 31, 2019 | FY ended Dec. 31, 2018 | Rate of Change (%) |
|
| Sales | 2,369,199 | 2,558,681 | (7.4) |
| Operating income | 59,405 | (78,852) | - |
| Net income | (57,879) | (182,696) | - |
Contract
-The Company has become an exclusive supplier of OE tires for Kia Motors’ compact sports utility vehicle (SUV), the Seltos, which is to be released in July 2019. The company is going to supply the Solus TA31 16-inch tires and the Solus TA91 Majesty 9 18-inch tires. (From some releases on July 11, 2019)
-The Company is an exclusive supplier of 20-inch OE tires for Hyundai Motor’s commercial van, the Solati Limousine, according to the tire manufacturer. Hyundai manufactures the Solati Limousine at a plant in Jeonju-si, South Korea. In Europe, the same model is sold as the H350, and it’s produced at a plant in Turkey. This model used to have 16-inch tires, but the automaker judged that they were too small for the model and asked the Company to develop 20-inch tires. (From a press release on May 21, 2019)
-The Company is going to provide Solus KL21 as original equipment (OE) tires for the Mercedes Benz G class. It first provided Benz with tires for the A class in 2007. Since then, it’s offering the OE tires for the Sprinter, the Smart, and the Vito. (From a press release on January 10, 2019)
Business Partnership
-The Company has reached a business alliance agreement with Mirae Asset Daewoo Co., Ltd., a security firm in South Korea, and the city of Gwangju on a transfer of its plant in Gwangju. The tire manufacturer built the plant in 1974 on a site of 396,000 square meters. However, the company is now planning to move it to the Bitgreen National Industrial Complex as the plant facilities are now too old. Hyundai Motor Company is also planning to build a new plant in the same industrial park. (From some releases on January 16, 2019)
R&D Structure
| Facility | Location | Overview |
| Central R&D Center | Yong-in, Gyeonggi-do, Korea |
-Year established : 2013 -Main R&D center |
| Kumho Tire America Technical Center (K.A.T.C) | Ohio USA |
-Year established : 2006 -Developing tires for the North American OEM market and the aftermarket |
| Kumho Tire Europe Technical Center (K.E.T.C) | Frankfurt, Germany |
-Year established : 1997 -Developing high-performance tires for the European market |
| Kumho Tire China Technical Center (K.C.T.C) | Tianjin China |
-Year established : 2006 -Developing high-performance tires for the Chinese and European markets |
R&D Expenditure (Consolidated) |
(in millions of won) |
| FY ended Dec. 31, 2019 | FY ended Dec. 31, 2018 | FY ended Dec. 31, 2017 | |
| Amount | 84,653 | 79,736 | 93,674 |
| % of sales | 3.57% | 3.12% | 3.26% |
Product Development
-The Company held a product show for dealers in Nanjing, China. At the exhibition, it unveiled Majesty9 Solus TA93 premium comfort tire and some other products. The Majesty9 Solus TA93 adopts “sound harmony technology” that optimizes the noise distribution. It offers improved riding comfort and quietness, compared to the conventional products, as well as enhanced safety and durability including superior wear resistance performance. In May 2019, the Company’s Chinese arm returned into the black for the first time in 30 months. On the consolidated bases, the tire manufacturer posted operating profits for two consecutive months in April and May 2019. In the second quarter (April-June), it expects to return to profitability for the first time in 10 quarters. (From a press release on June 20, 2019)
Capital Investment |
(in millions of won) |
| Division | Planned amount of investment for 2019 | Amount invested in 2019 | Planned amount of investment for 2020 | Purpose of investment |
| Tires (construction / industrial equipment) | 151,150 | 103,651(50,172) | 97,671 | Quality enhancement |