(Yicai Global) May 16 -- China’s Triangle Tire has given up a plan to build a USD580 million plant in the US state of North Carolina because of the changed investment environment and the impact of the Covid-19 pandemic.

Triangle Tire reached a project termination and mutual exemption agreement with the government of Edgecombe county, where the plant would have been built, the Shandong province-based tire supplier said late on May 13.

Triangle Tire had unveiled the project in November 2017, with the intention of offering localized services to clients in North America. The first phase, with an annual output of 5 million passenger car tires, was expected to begin construction in 2018 and be ready within three years. Building of the second phase, with a capacity for 1 million commercial vehicle tires a year, was to have started in 2020 and gone into operation within two and a half years.

The firm, which has an annual capacity of about 27 million tire sets, said it will supply clients in the United States and around the world with products made at its plants in China. Caterpillar, Terex, Doosan, Hyundai, and Volvo are among its main overseas customers, according to its website.

Shares of Triangle Tire [SHA: 601163] rose 0.7 percent today to close at CNY11.30 (USD1.66), after earlier gaining as much as 1.6 percent.

The loss of consulting fees during the project’s promotion process is about USD1.5 million and will appear in the firm’s earnings this year, as it had not started construction yet, Triangle Tire noted, adding that the processing fees for the project’s termination will be no more than USD120,000.

Editor: Futura Costaglione