In a major development, Sumitomo Rubber has announced the closure of its tire manufacturing plant in western New York, resulting in the loss of all 1,550 union and salaried positions.
The Japan-based company cited persistent efforts to manage costs and invest in the aging facility. Unfortunately, these efforts were not enough to counteract the growing financial losses.
Sumitomo announces closure of tonawanda plant amid market challenges
Sumitomo explained that the closure is largely due to the plant’s overall performance amidst an increasingly competitive international tire market. This challenging decision comes after a comprehensive analysis over several years of the company’s financial health and prevailing market conditions.
In a bid to save the Tonawanda facility, located near Buffalo, the company explored the possibility of finding a buyer. However, no offers materialized, sealing the plant’s fate.
In a significant move, Sumitomo has invested a substantial $140 million into their facility, with a notable $129 million injected in 2022, as highlighted by Erie County Executive Mark Poloncarz.
Historical Overview
The plant, which began operations in 1923, came under the full control of Sumitomo in 2015. This transition occurred after its parent company, Sumitomo Rubber Industries, concluded a joint venture with the Ohio-based Goodyear Dunlop Tires North America.
The abrupt shutdown of one of the region’s largest manufacturing hubs left both elected officials and employees in shock.
Mark Poloncarz expressed, “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 further noted, “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.”
