Yokohama Rubber to close off-road tire plant in Israel

Hiratsuka, Japan – Yokohama Rubber Co. (YRC) has announced a decision to close its off-road tire manufacturing plant in Hadera, Israel, effective 31 Dec.

Explaining the move, YRC said major tire manufacturers have set up facilities in South Asia in recent years to be closer to the key raw materials and low-cost labour.

“This has caused conversion costs in Israel to become uncompetitive compared to the Asian producers,” said YRC 14 Nov.

Furthermore, busy export routes through the South Asian countries have also brought down the costs of transporting tires to key markets.

The logistics costs as well as the ‘severely increasing' production costs have impacted the competitive advantage of Israel, YRC explained.

Given the present market environment and the structural shift in the manufacturing footprint of tire industry, YRC said it must take this measure “to bring the business back to a sustainable level of profitability.”

The consolidation move, YRC added, will ensure its alignment with market conditions and “therefore appears unavoidable.”

YRC acquired the ownership of the 72-year-old plant through its €1-billion purchase of Alliance Tire Group BV (ATG) in 2016.

The unit has the capacity to produce 42,000 tonnes of farm, earthmover and industrial bias & radial tires per year and currently employs 474 people.