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Hankook shares sink in Seoul on output worries

(Agencies)
Updated: 2009-09-15 07:57

Hankook Tire Co, the largest overseas tiremaker in China, fell the most in three months in Seoul trading after the US slapped a 35-percent tariff on Chinese-made tires.

The Korean auto tiremaker dropped 8.8 percent, in Seoul trading, to 20,200 won. Aeolus Tyre Co, the largest Chinese-listed tiremaker by market capitalization, fell 3.3 percent to 12.84 yuan in Shanghai.

Special Coverage: US tire duties 'serious trade protectionism' Related readings:  Obama Imposes Tariffs of 35% on Chinese Tire Imports  Tire case tarnishes US image  China firmly opposes trade protectionism

Seoul-based Hankook, which exports about 12 percent of its Chinese output, will switch to shipping tires from South Korean plants, it said in an e-mailed statement yesterday. US President Barack Obama imposed the levy after the United Steelworkers complained that Chinese imports were pushing US workers out of jobs.

"There is concern that Hankook Tire could be affected by the US decision," said Kevin Lee, an analyst at Shinhan Investment Corp in Seoul. He has a "buy" recommendation on the stock.

Hankook, which has two out of its five plants worldwide in China, had taken steps in anticipation of a tariff, it said. The company has about a quarter of the Chinese passenger-car tire market, according to its website.