Sumitomo Rubber has announced that its tire factory in western New York will be closing. This is a big change because it means that all 1,550 union and salaried jobs will be lost.
The Japanese company said it had been working hard to keep costs down and make investments in the old facility. These efforts were not enough, unfortunately, to stop the growing financial losses.
Sumitomo announces closure of Tonawanda plant amid market challenges
Sumitomo said that the plant’s overall performance in a global tire market that is becoming more competitive is a big reason for the closure.
A thorough study of the company’s finances and the current state of the market over several years led to this difficult decision.
The company looked for a buyer for the Tonawanda facility, which is close to Buffalo, in order to save it. But no offers came in, which sealed the plant’s fate.
In a big move, Sumitomo has put a huge $140 million into their facility, with an extra $129 million coming in 2022, as Erie County Executive Mark Poloncarz pointed out.
Historical Overview
It has been in use since 1923, and Sumitomo took full control of the plant in 2015. This change happened after its parent company, Sumitomo Rubber Industries, formed a partnership with Goodyear Dunlop Tires North America, which is based in Ohio.
Mark Poloncarz said, “It looks like this decision was made by the Japanese owner’s board without talking to local and state officials first about the possible closure.” He also said, “At no point did Sumitomo ask for any extra help to keep running, even though we have always supported their success in Erie County with tax breaks and help through the Erie County Industrial Development Agency.”
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