While domestic tire companies are expanding production in Southeast Asia and deploying in Europe and the United States, Fengshen Co., Ltd. has invested 2.681 billion yuan and selected Egypt, North Africa, as its first overseas production base in the history of corporate development.
In May 2026, this announcement quickly became the focus of the industry – it did not focus on popular areas, did not choose a traditional manufacturing base, and chose Egypt. Behind it was not only Fengshen’s global strategic choice, but also the in-depth layout of Chinese industrial tire companies to break through barriers and move towards high-end. It also marked that the industry’s “product export” has officially entered a new stage of “global localized manufacturing”.
Egypt’s first overseas factory: investment and production capacity
Aeolus adopts a clear two-tier operation structure for its overseas layout. It first invested 840 million yuan to establish a wholly-owned subsidiary, Aeolus Tire (Hainan) Co., Ltd., which can introduce partners to optimize capital allocation through capital increase and share expansion in the future. Aeolus Hainan will then jointly invest with Badian Egypt and China Rubber International to establish Aeolus Egypt Co., Ltd. to be responsible for project construction and operation.
The joint venture company has a registered capital of 1.516 billion. Fengshen Hainan invested 1.5 billion, with a shareholding ratio of 98.93%, achieving absolute control. The other two partners hold 1.07%, which not only ensures the synergy of local resources, but also firmly controls the project dominance.
The project is located in Alexandria, Egypt. Relying on the existing land and public engineering facilities of Badian Egypt, it will build a complete production line for rubber mixing, molding, vulcanization, etc., with supporting finished product warehouse, laboratory and test site. The overall construction period is about 20 months.
After the project is completed, it will have an annual production capacity of 1.5 million truck and bus tires, 30,000 engineering radial tires, and 30,000 agricultural radial tires, with a total production capacity of 1.56 million radial tires, focusing on the high-end industrial tire market.
For Fengshen, this is a key leap from domestic production to global layout; for Egypt, the project can effectively make up for the shortcomings in local high-end industrial tire production capacity, alleviate the situation of long-term dependence on imports, and at the same time drive the development of supporting industries and employment growth, and help improve and upgrade the local automobile and equipment manufacturing industry chain.
Aeolus Tire: A powerful enterprise in industrial tires
Many people’s understanding of Aeolus is limited to commercial vehicle tires, but in the professional field, it is one of the few core enterprises in China that focuses on the industrial tire track.
Unlike most tire companies that deploy all categories of passenger tires and commercial tires, Fengshen has long focused on the three high-value areas of truck and bus tires, engineering tires, and agricultural tires, and has embarked on a differentiated development path.
In 2025, the company will achieve revenue of 7.413 billion yuan, of which overseas revenue is 3.448 billion yuan, accounting for nearly 50%. The gross profit margin of overseas business will reach 25.9%, and the profit quality ranks among the top in the industry.
Technically, Fengshen has mastered the core technology of a full range of 49- to 63-inch giant tires. It currently has an annual production capacity of 300,000 sets of radial OTR tires, including 10,000 sets of giant tires. After the high-performance giant tire expansion project is put into operation in the second half of 2026, it will add 20,000 annual production capacity, further increasing the proportion of high-margin products.
At the same time, the company holds 10% of PTN’s shares and is entrusted to manage 90% of its shares. With the help of this high-end industrial tire company originated from Pirelli, it can fill in key shortcomings such as high-end research and development and supporting OEMs, forming a pattern of coordinated development of independent manufacturing and overseas technology.
Relying on stable product quality and supply chain advantages, Fengshen has successfully entered the supply chains of many global mining giants and commercial vehicle companies. It is a representative domestic enterprise that can gain a foothold in the overseas high-end industrial tire market, with clear positioning and outstanding competitiveness.
Losing Egypt: Three major advantages are clear at a glance
As the first step in Fengshen’s globalization, Egypt is not an accidental choice, but the result of the superposition of the triple advantages of trade policy, location logistics, and industrial environment. It is fully necessary and feasible.
From the perspective of trade barriers, core markets such as the European Union and North America have long-term trade restrictions on Chinese tires. Direct export costs are high and expansion is difficult.
Egypt has signed free trade agreements with the EU, Turkey, the African Continental Free Trade Area, etc. Products that comply with the rules of origin can enjoy preferential tariffs or even zero tariffs to enter the EU market, effectively breaking through trade barriers and opening up high-end market channels for Fengshen.
From the perspective of logistics efficiency, Egypt is located at the junction of Asia, Africa and Europe, guarding the core location of the Suez Canal. The shipping distance to Europe, the Middle East and Africa is shorter and faster. It can significantly reduce the logistics cost of large-volume products such as tires, respond to end market demand more quickly, and improve operational efficiency.
From the perspective of industry and policy, Egypt has launched tax exemptions, park facilities and other support policies to attract manufacturing investment, and the Suez Canal Economic Zone has formed a mature industrial ecology. At the same time, many Chinese tire companies have made early arrangements, and the industrial cluster effect has emerged, effectively reducing supporting costs and landing risks.
For Fengshen, Egypt is not only a strategic hub radiating the three core markets of Europe, Africa, and the Middle East, but also a global manufacturing base with reasonable comprehensive costs, strong policy support, and outstanding free trade advantages. The feasibility and long-term value of the project are very outstanding.
The rise of North Africa: a new strategic highland for tires to go abroad
Fengshen is not the first Chinese tire company to set up a presence in Egypt.
Looking at the industry as a whole, more than 20 Chinese tire companies have deployed dozens of overseas factories in more than 10 countries around the world. In the early days, they mainly focused on low-cost bases in Southeast Asia. In the past year or two, new investment has obviously concentrated in North Africa such as Egypt, Morocco, and Algeria. A number of leading companies have intensively settled in. North Africa is becoming an emerging strategic highland for China’s tire overseas layout.
Sailun Tire is expanding its radial tire project in Egypt with an annual output of 7.05 million units. After completion, the total production capacity of the base will exceed 10 million units; Chaoyang Langma invested in the construction of a tire base in the Suez Canal Economic Zone, focusing on passenger and heavy truck tires;
Sheng Rubber launched a project with an annual output of 6 million semi-steel tires in Morocco; Qingdao Doublestar participated in the construction of a large tire factory in Algeria through technical equity participation; Sentury Morocco’s Moroccan tire factory with an annual output of 12 million units has been successfully put into operation in 2024.
This also means that the underlying logic of China’s tire globalization is changing: from the simple pursuit of low cost in the past to a new model of being close to core markets, avoiding trade barriers, and realizing near-shore manufacturing. The Aeolus Egypt project is a typical manifestation of this trend.
Summary: Lay out overseas and embark on a new journey
The 2.68 billion yuan investment in the construction of the Egyptian factory is a strategic leap in the global development of Fengshen Tire, realizing the transformation from exporting products overseas to exporting production capacity overseas.
Relying on Egypt’s location, policy and market advantages, Fengshen will further optimize its global production capacity layout, deepen the development of overseas high-end markets, and add the synergy effects of the release of giant tire production capacity and PTN, and the company’s profitability and global competitiveness are expected to continue to improve.
From an industry perspective, Fengshen’s choice also provides a reference for Chinese industrial tire companies to go overseas: focusing on core tracks, getting closer to target markets, breaking trade barriers, and strengthening resource synergy are the steady paths to globalization.
The Egyptian base is not only Fengshen’s first overseas milestone, but will also become an important platform for China’s industrial tires to participate in global competition and move toward high-end development. As the project is put into production, the global story of China’s industrial tires will also open a new chapter.
