Shandong Daye, a prominent Chinese manufacturer of steel wire for tires, has announced plans to invest USD 208.5 million in a new manufacturing plant in Morocco’s Tangier Tech industrial zone, according to Tyre Press.
This strategic move is intended to enhance the company’s production and distribution capabilities, positioning it to better serve key clients such as Michelin, Goodyear, Continental, and Pirelli.
The factory will be constructed in two phases. Phase one involves an initial investment of USD 119.1 million and is expected to yield 40,000 tons of tire steel products annually upon completion, which is targeted for late 2026.
The overall production capacity is projected to be up to 100,000 tons of tire bead wire and 100,000 tons of steel cables each year. The timeline for phase two has not yet been disclosed.
In a statement to Chinese media, Shandong Daye cited Morocco’s robust industrial sector and advantageous trade positioning as key reasons for selecting Tangier for this facility.
The investment is designed to help mitigate the effects of shifting economic conditions and international trade frictions, allowing the company to quickly adapt to changing market demands.
Shandong Daye’s entry into the Moroccan market follows that of other international manufacturers, including Sentury, a global tire producer that launched operations in Morocco in September. By establishing a presence in Morocco, Shandong Daye aims to strengthen its supply chain and deepen ties with important automotive clients across multiple continents.
In 2023, Shandong Daye achieved production of 428,000 tons of tire steel products, accounting for over 38% of China’s total output. The announcement of the Tangier expansion has generated investor interest, reflected by a 5.9% increase in the company’s stock on the Shanghai Stock Exchange.
Morocco continues to attract significant investments from various sectors. For instance, GOTION High-Tech, a leading Chinese-European group backed by Volkswagen, is expected to establish an electric vehicle battery plant in Morocco with a huge potential investment of up to USD 6.3 billion. The two parties are collaborating to build a factory with a 100-gigawatt manufacturing capability, following negotiations for the EV battery plant that began operations in July 2022.
Additionally, Gotion Power Morocco plans to power its upcoming gigafactory for rechargeable batteries through a new 500-megawatt wind farm built by Saudi Arabia. Since President Joe Biden signed the Inflation Reduction Act, which allocated USD 430 billion to combat climate change, at least eight Chinese battery makers have announced new investments in Morocco.
Morocco has distinguished itself from other locations hosting plants by foreign companies by developing its ports, free zones, and infrastructure, fostering a conducive environment for investment. As noted by industry experts, “China has spent years subsidizing companies that extract critical battery minerals, manufacturers of cathodes, anodes, and electrolyzers, and carmakers including BYD.
Those companies’ eagerness to invest in Morocco to cash in on the Inflation Reduction Act indicates that “decoupling Chinese manufacturers from the supply chain will take years, if not decades,” according to Chris Berry, an adviser to battery companies and investors.
Through these initiatives, Morocco is solidifying its emerging role as a leader in renewable energy and sustainable industrial development, making it an attractive destination for global manufacturers.