Sumitomo Rubber USA’s (SRUSA) Tonawanda manufacturing facility in New York is to cease operations following an extended examination of its viability. Approximately 1,550 hourly (union) and salaried (non-union) employees will be affected.
The thorough analysis examined business complexities, including mounting material and logistics costs, dated infrastructure, intermittent financial performance and changing market conditions. It was undertaken as part of a broader strategy to ensure the long-term sustainability of the Sumitomo Rubber Group in the competitive tire market.
Over the last several years, the company has introduced cost-control measures, efficiency enhancements, capital investments and other improvements at the site. However, these changes have not reduced the financial losses at the facility.
The United Steelworkers Union Local 135 has been informed and the company is working with union representatives on effects bargaining and equitable severance packages. The company intends to actively collaborate with union representation and former salaried employees on various job placement support services to help ease workforce transition.
SRUSA is communicating with customers and suppliers to address concerns related to existing orders, delivery schedules and ongoing contractual obligations. The brand also intends to conduct research, development and testing activities at a yet to-be-determined US location.
All tire production at the Tonawanda facility will cease effective immediately, with related wind-down activities expected to conclude over the next 12-24 months.
The brand has said that it will continue to service existing customers without interruption by using a larger percentage of SRI’s global production capacity.
