Bridgestone exiting conveyor belt business in portfolio restructure

TOKYO—Bridgestone is withdrawing from the conveyor belt business with plans to be out completely by 2024.

"Bridgestone is restructuring the portfolio of its diversified products business to sharply focus on areas where it can leverage its core competencies," the company said in a Nov. 1 press release.

The Japanese group plans to reduce its production and sales volume gradually to minimize the impact to the operations of customers and suppliers, Bridgestone said.

Based within Bridgestone's Tokyo headquarters, the conveyor operation has a manufacturing footprint in Yokohama, Japan, and Rayong, Thailand, as well as an R&D center in Kanagawa. According to the group, all the sites manufacture and develop products other than conveyor belts and, therefore, will not be closed.

The exit move is part of Bridgestone's mid-term business plan (2021-2023, announced Feb. 16. It will increase the company's growth and adaptability, according to the press release.

"The Mid Term Business Plan aims to rebuild earning power through expense and cost structure reformation and enforcing premium business strategy to allow the company to enhance strategic growth investment," the company said. "By executing these strategies, Bridgestone is transforming to a 'strong' Bridgestone capable of adapting to the changing business environment."

The conveyor belt business is part of the group's chemical and industrial products business, representing about half of the sales of Bridgestone's diversified products business. The diversified products business posted sales of $4.4 billion last year and adjusted operating profit of about $85.3 million.

Bridgestone said it evaluated the business thoroughly, including potential to leverage core competencies, profitability toward the future and synergy within the group, before making the decision.

"The key point toward the decision was that it would not be possible for (Bridgestone's) conveyor belt business to keep providing both superior social and customer value while securing profitability," the company said.

It added that it "expects the impact on its consolidated financial results for 2021 to be minor."

Bridgestone expects most of the 250 "highly skilled and experienced" employees of the business to continue working with the group.

European Rubber Journal contributed to this story.