Thai tyre maker Deestone Group remains committed to investing 7 billion baht under a three-year business plan through 2017, citing strong demand in both domestic and overseas markets.
Suwicha Vongsariyavanich, managing director, said the company has spent 3.5 billion baht since April 2015 to raise production at its fourth plant making vehicle tyres in Nakhon Pathom's Bang Lane district. Capacity was increased to 10.5 million tyres from 5.5 million.
The remaining 3.5 billion baht will be slated for 2017, possibly to expand its production of tyres for vehicles and big trucks.
"Despite the country's overall bearish new car sales over the past few years, domestic demand for replacement tyres is still healthy driven by rising vehicle numbers every year," he said.
The Yingluck Shinawatra administration's first-time car buyer programme drove overall car sales up by 80.6% in 2012 to 1.44 million, 1.23 million of which were bought under the scheme.
Sales dropped to 1.33 million units in 2013, fell again to 881,832 in 2014 and declined to only 799,592 in 2015.
The Thai market for vehicle tyres totals about 12 million units per year, while Deestone controls a 12% market share.
It is anticipated over the next few years the market will see an average of 5-10% growth potential from 50 billion baht now.
Founded in 1982, Deestone supplies vehicle tyres, tubes and specialised tyres for all market segments. In 1994, with the establishment of Deestone International Co, the company diversified into bicycle, scooter and special industrial tyres and inner tube manufacturing for export.
Some 60% of Deestone Group products are destined for export markets in Southeast Asia, the Middle East, Europe and North America.
Deestone is a major Thai tyre manufacturer, running five plants and subsidiaries in Samut Sakhon and Nakhon Pathom with total investment of 6.5 billion baht. It has 10,000 employees and 600 dealers nationwide.
The company just commenced operation of its fifth plant a couple of years ago, making truck tyres in Kamphaeng Saen, Nakhon Pathom.
The 3.5-billion-baht factory won Board of Investment privileges to manufacture 1 million tyres a year using 1,000 employees.
Deestone has combined annual production of 10.5 million vehicles tyres, 1 million truck tyres, 12 million bicycle tyres and 6 million motorcycle tyres.
Mr Suwicha said though the economy in certain Asean countries remains fragile, the company believes the overall international market for replacement tyres still remains vibrant.
Thailand ranks as the sixth-largest country for tyre manufacturing.