Apollo Tyres is one step closer to choosing a location for its new European tire plant. The European Commission recently approved a proposal to give Apollo Tyres (Hungary) Kft. €95.7 million (approximately $123.4 million) for the construction of a tire plant in Gyöngyöshalász, Hungary.
The tire company, which announced its decision to build an Eastern European facility in May, has not officially confirmed the site as its choice for the greenfield plant.
According to the EC, the project is expected to create more than 975 new jobs in the region, an area with high unemployment and a GDP well below EU averages, making the area eligible for regional aid under Article 107(3)(a) of the Treaty on the functioning of the European Union (TFEU).
The EC approved Hungary plans to support the construction of the new tire plant with a direct grant of €48.2 million (approximately $62.11 million), an employment grant of €2.8 million (approximately $3.61 million) and tax allowances of around €44.7 million (approximately $57.6 million).
The plant is expected to be the first of its kind for Apollo outside of India, and will be commissioned sometime between 2017-18. It will produce both passenger and truck tires. Apollo was also considering Slovakia as a site for the greenfield plant.