(Yicai) Nov. 21 -- French tire giant Michelin has begun work to expand its Shanghai factory again after first increasing its capacity in 2021.

Work on the project's first phase started yesterday and will be completed by the end of 2026, Michelin announced on WeChat the same day. The expansion will increase the annual capacity of high-performance radial tires for sedans by 1 million units to 9.5 million, it added. 

The second stage will further hike output and commit to clean and efficient production to lower carbon emissions, Michelin noted. The latest expansion project will set up a flexible, green, and intelligent plant of over 70,000 square meters, according to the company.

China is an important market for Michelin, Chief Executive Florent Menegaux said at the project's opening ceremony. As the country is on the way to high-quality development, the mobility industry and consumers have a higher demand for green and intelligent products, which creates more opportunities for the firm to further develop its local business, he added.

Built in 2001, Michelin's Shanghai factory is one of its two tire production bases in China, with the other located in Shenyang, Liaoning province. The company's first expansion project in Shanghai included upgrading the plant’s production lines intelligently and raising its annual capacity from 7 million to 8.5 million units.

Since 2010, Clermont-Ferrand-based Michelin has aimed to halve carbon emissions in production and energy use by 2030 and realize carbon neutrality in production, energy use, and transportation by 2050, the company noted.

Michelin's global sales rose 2 percent to EUR21.2 billion (USD23.2 billion) in the nine months ended Sept. 30 from a year earlier, it said in an earnings report released on Oct. 24. Sales of original equipment tires and replacement tires in China jumped 2 percent and 13 percent respectively, thanks to the rebound in demand as more and more people travel domestically, it added.

Editor: Martin Kadiev