PARSIPPANY, N.J.—Degussa Engineered Carbons L.P. will close one of two rubber black production lines at its Belpre, Ohio, carbon black plant on Sept. 30 because of slowing demand.
About 15 employees will be laid off, the company said. The closure won´t affect the remaining rubber black line or the production of pigment grades at Belpre.
DEC´s cutback follows moves by some tire makers in North America to restructure their manufacturing operations and close several tire plants, said Jack Clem, president and general manager of DEC. The company´s decision to reduce rubber black production is aimed at aligning DEC with its major customers, rationalizing its capacity and removing costs from the system, he said.
"This retrenchment is expected to last at least through next year," according to Chris Erickson, vice president and business director of rubber blacks. The company is prepared for that possibility, but the firm is hopeful it won´t last that long and the line will be back up and running before then, a spokesman said.
DEC said the line, which produces 30,000 metric tons per year, would remain intact and could be restarted when customer demand warrants. Company officials declined to release capacity figures for the remaining line or information about the firm´s place in the rubber black market for competitive reasons.
Clem said DEC regretted the reduction in its work force, particularly after the strong progress the Belpre facility has made in improving productivity. But with slowing demand from the tire industry and the ability to meet customer commitments in the foreseeable future from other facilities, he said, "we believe this is the best way for us to remain competitive in this tough North American environment."
The closing of several major tire facilities in North America hasn´t been fully offset by expansions in the remaining production factories of North American tire producers, the company said. In addition, low-cost, imported tires continue to gain market share.
While the long-term demand trend for carbon black should remain positive, it is presently undergoing a restructuring, according to DEC.