As a result of the challenging long-term evolution of the passenger tire industry in the European market, Bridgestone has announced it is taking structural measures to reduce overcapacity and save costs, and has decided to halt all activity at its Bethune plant in France.
It states that the closure will affect 863 employees and claims it is undertaking a consultation process to try and support both these employees and mitigate the effects of the closure on the immediate region surrounding the factory.
According to the company, the current state of the passenger tire industry is threatening its competitiveness in the European market. It notes that for several years, the market for passenger tires has been facing strong headwinds – even before the impact of the Covid-19 pandemic is accounted for. The market has seen volumes stabilize over the last few years (average annual growth <1%) while competition from low-cost Asian brands continues to increase (market share of 6% in 2000 increased to 25% in 2018) leading to general production overcapacity.
This, it says, has resulted in pressure on pricing and margins, as well as overcapacity in the low rim diameter segment, given a declining demand in LRD. Bridgestone notes that the Bethune plant is its least well positioned and least competitive within Europe.
“Closing the Bethune plant is not a project we are taking lightly. But there is no other solution to overcome the challenges that we are facing in Europe. This is a necessary step to ensure that we preserve the sustainability of Bridgestone’s business in Europe,” explained Laurent Dartoux, CEO of Bridgestone EMIA.
“We are fully aware of the implications of the announcement made today and of the consequences that it could have for the employees and their families. This project is no reflection on the engagement of the employees, nor on their many years of commitment to delivering high quality products for our customers, it is a direct result of a market situation that Bridgestone needs to address.
“The priority is clearly to find a fair and adapted solution for all the employees by offering each of them individual support, as well as solutions consistent with their personal and professional projects.”