Goodyear Tire Co. has announced it will close its Malaysian factory, a decision that comes after six consecutive years of losses at the plant. The factory has continued to suffer losses since 2017. The shutdown will begin on June 30 and is expected to completely cease operations by December 31. Goodyear has 10 factories in Asia, including 3 in China, 2 in India, 1 each in Indonesia, Japan and Thailand, and 1 in Vietnam. The move will result in a reduction in Goodyear's production capacity in Asia.
Although Goodyear has closed its Malaysian factory, the Southeast Asian tire market is not stagnant. Cambodia and Indonesia are still attracting new tire investments. However, Thailand and Vietnam are affected by the US anti-dumping and anti-counterfeiting investigations, and some tire companies have suspended or suspended investments in these regions.
The uncertainty of the global economic environment brings risks to tire companies' overseas investments. Thailand and Vietnam have received attention due to double-negative issues, Sri Lanka has experienced an economic crisis due to high inflation, and India has been affected by the Red Sea crisis and its transportation cycle cannot be guaranteed. Although overseas investments are expected to bring higher profits, unfamiliar environments also mean more risks.
Overall, Goodyear's closure of loss-making factories is a strategic adjustment in response to the current high costs and high inflationary pressures in the tire industry. In the future, Goodyear may need to find a balance between globalization and risk management to achieve long-term development.