Yokohama has announced its decision to close its manufacturing plant located at Hadera, Israel. The plant is one of 30+ manufacturing sites in the YRC global network and has been operating for 70+ years. It will cease operations effective December 31, 2024.
Over the past few years, major tyre manufacturers have set up manufacturing facilities in South Asia, bringing them closer to the key raw materials and at the same time leveraging the abundance of labour at lower costs. This has caused conversion costs in Israel to become uncompetitive compared to the Asian producers. Busy export routes passing through the South Asian countries have also brought down the costs of transporting tyres to key markets, further tilting the competitive advantage away from Israel and severely increasing the relative production costs affecting the exports.
Given the present market environment and the structural shift in the manufacturing footprint of the tyre industry, YRC must take this measure to bring the business back to a sustainable level of profitability and secure its future. A consolidation of YRC’s production footprint to ensure alignment with market conditions therefore appears unavoidable.
Closure of the Israel plant is a difficult but necessary step to ensure the long-term sustainability of YRC. They are committed to supporting their employees, partners and vendors during this transition and are engaging with them to minimise the impact of this decision.
YRC is a leading provider of tyres globally in PCR, TBR and OHT segments headquartered in Japan. YRC plans to increase its share in the OHT market segment and has invested in growth programs. It’s already the world’s largest manufacturer of agricultural tyres and close second in the industrial tyre segment. YRC believes in efficient and world class manufacturing to support its growth programs in a sustainable way, which requires it to monitor its manufacturing footprint on a continuous basis.
Source: Tyretradenews
