The Cabot Corporation carbon black manufacturing facility in Merak, Indonesia, is to close. It is anticipated that manufacturing operations will cease there by the end of January 2016.
“To be successful over the long term, we must continue to focus on improving profitability through cost savings and increased operational efficiency, while also producing the highest quality products that meet our customers’ needs,” said Sean Keohane, president, reinforcement materials segment. “The decision to consolidate manufacturing across Asia Pacific is a critical step in our plan to ensure that we are operating as efficiently and effectively as possible to become more competitive in a challenging environment, and to accelerate future growth.”
The decision, which will affect approximately 50 local employees, was driven by the Merak facility’s financial performance over the past few years. Despite efforts to be competitive, the facility has suffered from low utilization rates. Asia is quickly becoming one regional market and this dynamic has created the need for facilities to be even more cost competitive. As such, Cabot will consolidate production in Asia by ceasing production at the Merak facility and using the Cilegon, Indonesia, as well as other Asian and global carbon black production sites, to meet the regional demand.
November 25, 2015