In the face of the turbulent global trade situation and market changes, tire giants are stepping up their efforts to adjust their development strategies and actively changing the layout of their plant production capacity. Especially, the tire industry in the United States has become the focus of these giants.
Goodyear's local factories undergo major changes
Recently, Goodyear announced that in order to adapt to the constantly changing automotive market in North America, the company has converted the annual production capacity of its Lawton plant in Oklahoma to "high-end tires".
This transformation project will focus on larger-sized tires, thereby creating additional sales volume for "markets with higher profits and higher profit margins". The new products include tires for electric vehicles and self-driving cars. The new production capacity is expected to be put into use in 2025 and 2026 respectively.
According to relevant sources, the factory will invest 320 million US dollars and the project will last for four years. The Lawton factory covers an area of 2.94 million square feet and has a daily production capacity of 88,000 tires, making it Goodyear's largest plant.
While investing in the Lawton factory, on April 1st, the layoff plan for 850 employees at the Goodyear factory in Danville, USA came into effect. This move is part of Goodyear's business focus shift from commercial tire production to aviation tire production.
Goodyear is collaborating with the United Steelworkers Union of the United States to address the impact on personnel allocation, and is offering severance pay based on years of employment schemes for about 800 employees.
The Danville plant will continue to produce aviation tires and maintain its mixing business, while most of its commercial tires will be transferred to other plants. This round of layoffs will reduce the number of employees at this plant by half.
Michelin regards the United States as the core of its domestic operation strategy
Recently, Michelin has released its development plan for the market environment in 2025. The goal is to achieve profit growth under the complex and volatile global trade situation. Although Michelin is optimistic about the growth in key markets and the recovery of demand for original equipment (OE) tires, international trade tariffs remain the "Sword of Damocles" hanging over the company's business, making it impossible for the company to take it lightly.
Michelin plans to fully explore "targeted growth opportunities", further enrich its product portfolio and vigorously strengthen its local production strategy. Michelin stated that the local production strategy is one of the most effective means currently available to address the ongoing crisis in the global supply chain.
Among them, the most crucial aspect of the localization strategy is its business in the United States. Tire sales in the US account for one-third of Michelin Group's total revenue. It has 23,000 employees and operates 35 local factories across the country. Among them, 20 factories are dedicated to tire production, and 15 focus on polymer solutions.
Michelin's CEO Florent Menegaux also said in an interview with the Financial Times of the UK earlier that if President Trump imposes import tariffs on its major trading partners, the company might "adjust its priorities" to enhance the production capacity of its plants in the US.
From the above two major measures taken by the two leading tire manufacturers, it is not difficult to see that in the face of the global supply chain crisis, the giants with a more in-depth "globalization" layout are the first to bear the brunt. Their series of policies also expect to seize the initiative in the market competition in 2025 through strategic adjustments and achieve stable growth in profits.
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