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· Bridgestone South Africa (BSAF) has proposed the closure of its 84-year-old manufacturing plant in Port Elizabeth in South Africa
· The facility has been manufacturing older bias tires
· As mandated by law, the company has issued retrenchment notices to around 250 employees working at the facility
Bridgestone South Africa (BSAF) has proposed the closure of its 84-year-old manufacturing plant in Port Elizabeth in South Africa. The facility has been manufacturing older bias tires. As mandated by law, the company has issued retrenchment notices to around 250 employees working at the facility.
The closure, company officials said, was due to declining demand in “older bias tires” that are made at the plant. The company also said that changing the production line to radial tires would entail huge cost. The company is presently not inclined to switch over the radial tire production at this facility at a time market is constrained by demand compression. Globally demand for older bias tires is declining.
BSAF has a radial factory in Brits in the North West part of the country and R400 million was invested last year in that facility as part of a R700 million investment of Bridgestone in SA. The company is also facing threats from cheap imports. The closure of the Port Elizabeth facility will not affect the supply chain since radial tires from the North West can take care of the market.
In recent years the company has considered many other alternatives, including cost containment measures, the sale of the plant to a suitable buyer, export opportunities, public funding and possibly relocating different product lines to PE. BSAF has made assurances that it will exercise due diligence to ensure compliance with all legal requirements and accepted practices, as well as to ensure that all 252 affected employees are treated fairly and supported through the transition.
