Sumitomo Rubber has announced the shutdown of its tire manufacturing factory in western New York, affecting all 1,550 union and salaried employment.
The Japan-based corporation noted ongoing efforts to control costs and invest in the aging facilities. Unfortunately, these measures were insufficient to mitigate the rising financial losses.
Sumitomo announces closure of tonawanda plant amid market challenges
Sumitomo stated that the closure is mostly due to the plant’s overall performance in an increasingly competitive international tire market. This difficult choice was made after several years of thorough research of the company’s financial health and current market conditions.
In an effort to save the Tonawanda facility, which is near Buffalo, the business looked into finding a buyer. However, no offers emerged, ensuring the plant’s destiny.
Sumitomo has made a large investment of $140 million in its facilities, with a notable $129 million injection in 2022, according to Erie County Executive Mark Poloncarz.
Historical Overview
Sumitomo took full ownership of the plant in 2015, after it began operations in 1923. This change occurred after Sumitomo Rubber Industries, its parent business, formed a joint venture with Goodyear Dunlop Tires North America, situated in Ohio.
Mark Poloncarz commented: “It seems this decision was made by the Japanese owner’s board without any prior discussion with local and state officials regarding the potential closure.”
He also stated: “At no time did Sumitomo seek any additional support to continue operations, even though we have consistently backed their success in Erie County with tax incentives and aid via the Erie County Industrial Development Agency.”
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