Egypt, China team up for $1B tire mega-plant

Egypt partners with China’s Sailun Group for $1 billion tire manufacturing hub

Egypt has entered into a $1 billion agreement with China’s Sailun Group to establish a major tire production facility in the Ain Sokhna Integrated Zone, part of the Suez Canal Economic Zone (SCZone). The project is expected to play a key role in Egypt’s strategy to strengthen its automotive industry and boost local manufacturing.

Three-phase development to reach 10 million tires a year

The new facility will be developed over a 350,000-square-meter site managed by TEDA Egypt, an industrial developer within the SCZone. Construction will take place in three phases over three years.

The first phase, scheduled for completion in 2026, will produce an estimated 3 million passenger car tires and 600,000 truck and bus tires annually. Once fully operational, annual production capacity is expected to surpass 10 million tires, meeting both domestic needs and export demand across regional markets.

Government views project as strategic to industrial localization

Prime Minister Mostafa Madbouly attended the signing ceremony alongside TEDA Egypt CEO Cao Hui and Sailun Group President Xie Xiaohong. Madbouly highlighted that the project fits within Egypt’s broader goal of localizing automotive production and creating an integrated manufacturing supply chain.

He praised the SCZone’s proactive investment promotion and emphasized that national infrastructure developments—including expanded road networks, tunnels, and port upgrades—are helping position Egypt as a regional leader in automotive manufacturing. The prime minister also called for closer cooperation between public and private sectors to accelerate progress.

SCZone aims to create an automotive industry cluster

SCZone Chairman Waleid Gamal El-Dien described the tire project as a cornerstone of the authority’s automotive localization strategy, initially launched in the East Port Said Integrated Zone. He noted that the SCZone is working to build specialized industrial clusters that support vehicle production and related value chains.

He also referenced a recent promotional tour in China, where SCZone officials met with electric vehicle manufacturers, battery producers, and top automotive parts makers to explore advanced technologies and determine the infrastructure, utilities, and workforce requirements for similar investments.

Sailun Group’s global presence and regional ambitions

Founded in 2002, Sailun Group is one of China’s largest tire manufacturers, with production facilities in China and Vietnam. The company’s annual output includes more than 26.6 million truck and bus radial tires, 88 million passenger car radial tires, and 310,000 tons of off-the-road tires. Its distribution network spans over 180 countries and regions.

The planned Sokhna plant is expected to serve as a strategic manufacturing hub for Egypt and neighboring markets, benefiting from the SCZone’s tax incentives, special regulations, and access to global shipping lanes via the Suez Canal.

Chinese investments in Egypt continue to grow

According to the General Authority for Investment and Free Zones (GAFI), around 2,800 Chinese companies are currently operating in Egypt, with combined investments exceeding $8 billion. This figure is projected to rise to $12 billion by the end of 2025, reflecting China’s expanding role in Egypt’s infrastructure, industrial, and technology sectors.