Twists and turns and 2024's top stories

Every year has its own tempo. Some of the twists and turns may be expected, while others come out of nowhere, causing industry players to react and change direction as needed.

The year 2024 was no different for the tire and rubber industries.

There were plant closings, a keen focus on the presidential campaign, regulations from across the pond that will have wide ranging effects and personalities making their own distinctive impact on the year's canvas.

Here are what Rubber News sees as six of the top stories that came across our radar over the past year.

In many ways, the economy in North America and elsewhere was strong during 2024. But along the way, there was an undercurrent pointing to a potential economic downturn.

And some very real evidence of that came through in the form of plant closure announcements in both the tire and rubber goods industries.

Sumitomo Rubber Industries Ltd. had the largest such closing in the U.S. as the Japanese-owned tire maker said in November it was stopping all production immediately at its more than century-old tire factory outside Buffalo, N.Y., resulting in the loss of 1,555 jobs. Kobe, Japan-based SRI said in a Nov. 7 disclosure that it and its U.S. subsidiaries worked to improve SRUSA's production structure and operational efficiencies, however, "the business environment remains severe due to the deterioration of productivity and profitability at SRUSA, and profitability is hard to improve in the long term."

Sumitomo, in the weeks following the closure, said it will study ways to secure tire production in North America in the near future.

But that wasn't the only closing making headlines during the year. Other plant shutdowns or announcements included:

• Michelin said in November it will close its Cholet and Vannes production plants in France by early 2026, a move that will cost 1,254 employees their jobs;
• Yokohama Rubber Co. Ltd. is closing its off-the-road tire plant in Hadera, Israel. A member of the Yokohama Off-Highway Tires group, the factory produces 42,000 metric tons of farm, earthmover and industrial bias and radial tires per year and has a work force of 474;
• Timken Co., a producer of engineered bearings and power transmission components, will "gradually wind down" its belt production plant in eastern Kansas and close the facility some time next year. Timken sent a WARN notice to the 155 employees at the plant Nov. 30, 2023, that it will shutter the Fort Scott facility by 2025;
• Gates Corp. said in an August WARN notice that it will shutter a 41-person hydraulic hose production facility located about midway between St. Louis and Indianapolis, in Jasper County, Iowa. The closing was scheduled by be completed by the end of November;
• Wabtec Corp. disclosed plans to close a rubber products plant in Brenham, Texas, a move that put about 50 hourly workers out of jobs. Layoffs were to begin April 1; and
• Hexpol Compounding Americas, a division of Hexpol Group, will close its rubber mixing facility in Kennedale, Texas, by the second quarter of 2025. All business from the facility will be relocated to other Hexpol plants in North America.

The presidential campaign dominated the conversation during 2024, and Donald Trump's victory and impending return to the White House will bring direct impact to the tire and rubber industries.

Policies in a second Trump administration will differ widely from those in the soon-to-end Joe Biden presidency in numerous key areas. From positions on electric vehicles and fossil fuels (a key component in synthetic rubber), to views on tariffs and the environment, the lay of the land will change markedly come early 2025.

The U.S. Tire Manufacturers Association said it will continue to work on its "longstanding legislative priorities" as Trump retakes office in January. The group expects to see a shift in regulatory priorities for the rubber industry at large, it said, including a potential pause in regulation altogether.

"(Our priorities include) advocating for updated National Highway Traffic Safety Administration rules on consumer tire information and performance standards, as well as the modernization of tire testing regulations," the USTMA said. "Additionally, we'll be closely focused on trade issues, expanding sustainability efforts, and supporting domestic manufacturing job creation."

The American Chemistry Council was one of several organizations that congratulated the president-elect on his victory. ACC President and CEO Chris Jahn emphasized that the chemical industry is one of the largest in America.

"The men and women of the chemical industry, and nearly every economic sector in the country, are relying on the Trump administration to keep U.S. chemical manufacturing the most innovative and competitive in the world," Jahn said.

The United Steelworkers have vowed to work with the new Trump administration, but "not allow the billionaire class to run roughshod over workers' rights" in a second term, the union said in a statement.

Bill Hyde, vice president of olefins and elastomers at Chemical Market Analytics, forecasted a massive infrastructure investment under a Trump win. Specifically, he cited pipeline building and further American oil drilling as changes from a Biden term to a second Trump term.

At the end of 2023, Goodyear unveiled its Goodyear Forward plan that it said would reposition the company in a sweeping fashion, giving the world's No. 3 tire maker a more optimized portfolio, double its profit margin by the end of 2025, and make it a far less-leveraged company with lower debt.

And Goodyear CEO and President Mark Stewart—who replaced Richard Kramer in those roles on Jan. 29—said thus far the firm is making excellent progress with the program.

The most visible move made under the Goodyear Forward initiative was the July 22 deal where Goodyear agreed to sell its off-the-road tire business to Yokohama Rubber Co. Ltd. in a $905 million cash sale. Goodyear's OTR business includes specialized tires for mining and construction, among other industries. The sale will be completed upon the usual regulatory approvals and is expected to close by early 2025.

Goodyear's OTR business posted fiscal sales of approximately $678 million in 2023, with earnings before interest, taxes and amortization of about $129 million. Goodyear's OTR unit employs around 500.

Stewart called the sale "an important milestone" as the Akron-based tire maker implements its Goodyear Forward plan. One goal of the plan was to raise $2 billion through the sale of its OTR, Dunlop brand and synthetic rubber/chemicals business.

Goodyear has yet to sell the Dunlop or chemical units, and Stewart said the company won't unload those businesses in a "fire sale." He said the Dunlop brand, which dates back to the 1880s, has increased its market share in Europe despite what he called a "flat to overall declining" European market.

"So we feel very good about Dunlop, and we won't fire-sell that asset," Stewart said at the SEMA show in November. "If we don't get the appropriate amount, then it won't go. So we'll just see how it goes in the process. And it's moving along in the process, but we'll see."

In fact, Stewart and Christina Zamarro, Goodyear chief financial officer and executive vice president, said during a conference call for third-quarter financials that the Goodyear Forward process is working.

"I want to acknowledge the momentum that the Goodyear team has collectively created over the last four quarters, with four consecutive quarters of market growth," Stewart said during a Nov. 5 investor call. "Goodyear Forward is delivering significant and tangible results both in the bottom line and as a key driver in enabling us to structurally change the way we govern the company."

Zamarro added that the restructuring plan has thus far provided $1.5 billion in gross annual run-rate benefits.

"We expect this program to benefit segment operating income by $450 million in 2024," she said, adding this is up by $100 million over previous targets. "And we should see a $750 million year-over-year benefit for segment operating income in 2025 (specifically from Goodyear Forward)."

Denka Performance Elastomers L.L.C. and the U.S. Environmental Protection Agency have been in litigation for the past several years, and 2024 was no different.

In April, the U.S. EPA finalized a rule governing toxic air emissions at about 200 synthetic organic, chemical, polymer and resin production plants from the Gulf Coast to West Virginia.

EPA Administrator Michael Regan said the update to the Clean Air Act had it roots in the Mississippi River Chemical Corridor, an 85-mile stretch known as "Cancer Alley" that has 150 chemical plants in Louisiana between Baton Rouge and New Orleans.

Denka told Rubber News that it considered the compliance deadline "politically driven," as the EPA set the period to comply with fenceline threshold standards at 90 days to meet chloroprene emissions standards at its plant in LaPlace, La., America's only neoprene manufacturing facility.

The EPA had given other chemical companies two years to meet emissions retrofits.

Denka, though, found an ally in the Louisiana Department of Environmental Quality, which gave Denka a two-year extension on meeting the emissions mandates. And on July 31, the U.S. Fifth Circuit Court of Appeals granted DPE's emergency petition to stay the EPA's 90-day deadline.

The court battle between Denka and the EPA continued late into the year, as the EPA asked the Eastern District of Louisiana court to reopen the emissions compliance case.

One of this year's top stories actually comes from a European Union regulation that came into force in summer 2023. But it garnered much more attention this year as its deadline for compliance—originally anticipated by the end of 2024—creeped near.

The EU Deforestation Regulation (EUDR) came into force June 30, 2023. And while its effective date has since been delayed one year, all eyes were on the new law that will ban the import and entry into the EU market of natural rubber—as well as several other commodities—and its derived products if it comes from land deforested or degraded after Dec. 31, 2020.

At face value, the law seems innocuous.

The methods in which operators and traders must prove their compliance, however, is where things get sticky.

The regulation calls for extensive documentation and data for each commodity, packaged into what is called a "due diligence statement." This statement then is to be submitted via the European Commission's Information System.

The system was not ready until earlier this month, which would have given stakeholders less than a few weeks to submit their proof of compliance had EUDR's effective date not been postponed.

In the rubber industry, the law drew criticism from manufacturers and industry associations alike, as concerns mounted over its timeliness, logistics and potential impact on rubber smallholders.

EUDR's goal, entities like the European Tyre and Rubber Manufacturers' Association and the Global Platform for Sustainable Natural Rubber agreed, is admirable. Its implementation, less so.

As of Dec. 17, Parliament and the European Council have officially approved EUDR's delay, meaning large operators and traders now must meet its obligations by Dec. 30, 2025, and micro- and small enterprises by June 30, 2026.

Erick Sharp was named the 2024 Rubber News Executive of the Year, as a longtime industry veteran who has helped reshape the materials testing sector as president and CEO of Ace Laboratories.

He started his rubber industry career in 2003 with Edgetech I.G. Inc., a subsidiary of Lauren International at the time. From there he moved to custom mixer Portage Precision Polymers, which was bought in December 2014 by what is now Hexpol Compounding Americas.

At that point, Sharp started his own firm, Ace Products and Consulting L.L.C., which was mainly a consulting and development firm for its first couple of years.

But with a clear vision and help from three key investors—including Doug Hartley, his friend and the previous owner of Portage Precision Polymers—Sharp has built a company that now operates out of its own facility in Ravenna, Ohio, with plenty of room to grow. The company now has 21 employees and broadened its scope under the new name of Ace Laboratories.

"Did I feel like I was jumping off a cliff and building the airplane on the way down? Yes, it felt like that several times," Sharp told Rubber News. "But I am always of the mindset that we can accomplish bigger things by working together."

Doug Foster, director of technical services at Ace, said Sharp's defiance of gender norms is as intentional as his approach to business growth—and the two are inextricably linked.

"Erick is known for always challenging the norm and looking for new ways to do things," Foster said. "His approachable and clear leadership style fosters a positive and cohesive team dynamic, creating an environment where employees feel supported, engaged and empowered to perform at their best."