Senior French politicians have expressed their “total disagreement” with Bridgestone‘s decision to shutter its aftermarket tyre plant in Béthune, potentially affecting up to 863 jobs.
Bridgestone says the closure would not take place before the second quarter of 2021 and insists the move is the “only viable option” to safeguard its competitiveness in Europe.
In a rare joint statement from French Labour Minister, Elisabeth Borne, Economy Delegate Minister, Agnès Pannier-Runacher and Hauts-de-France Regional Council president, Xavier Bertrand, the politicians combined to urge Bridgestone consider alternative possibilities.
“They [politicians] dispute the brutality, relevance and fundamentals of it [closure]” said the statement. “The State and the Region are asking Bridgestone to take its responsibilities, while it has largely de-invested the Béthune factory for several years in favour of other European sites, bringing about a competitive deficit and more, allocated to the plant low-margin products, whose market is in continuous decline.
“The State and the Region will be alongside staff with the sole objective of maintaining industrial employment at the Béthune factory. A meeting with unions and local politicians will be organised in the next days to understand the situation and decide the next steps.”
Bridgestone announced the news today (16 September) during an Extraordinary Works Council, insisting it is “fully aware of the social consequences” of the project and is committed to using all means at its disposal to define support plans for each employee.
This would be done in consultation and through sustained dialogue with employee representatives. Pre-retirement measures, support for the reassignment of staff to other Bridgestone activities in France and initiatives to facilitate external redeployment, will be proposed by the company and discussed in detail with employee representatives in the coming months.
Bridgestone added it intends to minimise the impact on the region as much as possible by deploying an employment revitalisation plan for the area. The company has committed to establishing a dedicated outplacement programme and to actively search for a buyer for the site.
The supplier adds the current industry context for passenger tyres is threatening its competitiveness in the European market. For the last several years, the market for passenger tyres has been facing strong headwinds – even without taking into account the impact of the COVID-19 pandemic.
The passenger tyre market has seen its volumes stabilise during the last few years (average annual growth < 1%) while competition from low-cost Asian brands continues to increase (market share of 6% in 2000 increased to 25% in 2018) leading to general production overcapacity.
This has resulted in pressure on pricing and margins, as well as overcapacity in the Low Rim Diameter segment, given a declining demand in LRD. And within Bridgestone’s overall European footprint, the supplier maintains its Béthune plant is the least well positioned and least competitive.
During the last years, Bridgestone added it has taken several measures, including attempts to increase the competitiveness of the Béthune plant. These have proven to be insufficient and Bridgestone has been losing money on tyres produced in Béthune for several years. The supplier maintains considering current market dynamics, no improvement in the situation is foreseeable.
“Closing the Béthune plant is not a project we are taking lightly,” said Bridgestone EMIA CEO, Laurent Dartoux. “But there is no other solution to overcome the challenges we are facing in Europe. This is a necessary step to ensure we preserve the sustainability of Bridgestone’s business in Europe.
“We are fully aware of the implications of the announcement made today and of the consequences it could have for the employees and their families. This project is no reflection on the engagement of the employees, nor on their many years of commitment to delivering high quality products for our customers, it is a direct result of a market situation Bridgestone needs to address.
“The priority is clearly to find a fair and adapted solution for all the employees by offering each of them individual support, as well as solutions consistent with their personal and professional projects.”
Bridgestone said it will continue to “keep a high presence” in France, notably through sales and retail operations with around 3,500 employees.