Goodyear's Big Move: Shutting Down Tire Plant in Malaysia

Goodyear’s Big Move: Shutting Down Tire Plant in Malaysia

In a significant corporate move, Goodyear Tire & Rubber Co, a leading global tire manufacturer, has officially announced the closure of its manufacturing plant in the Shah Alam district, Selangor state, Malaysia. This decision, set to take effect on June 30, is part of Goodyear’s comprehensive corporate restructuring program known as Goodyear Forward.

The restructuring initiative aims to achieve substantial cost reductions, with a target of $1 billion by the year 2025. The closure of the Shah Alam plant, operational since 1972, is expected to impact more than 500 employees.

The company, in a statement released on Thursday, emphasized the gravity of such decisions, stating that they are not made lightly. Goodyear reiterates its commitment to treating its associates with care and respect throughout this transition period.

Despite the plant’s closure, Goodyear reassures its dedication to serving the Malaysian market. The company plans to continue delivering its industry-leading products and solutions by leveraging other manufacturing sites within Goodyear’s global footprint.

This development follows years of allegations and accusations of labor abuses at the Malaysian manufacturing plant. These allegations include issues such as unpaid wages, excessive overtime, and threats against migrant workers.

Goodyear's Big Move: Shutting Down Tire Plant in Malaysia

In 2022, Goodyear reached a settlement agreement with the affected workers, wherein each employee received compensation ranging from 50,000 to 200,000 ringgit ($10,660 to $42,644), depending on the length of their employment.

The Malaysian Investment Development Authority (MIDA) reported on Friday that the closure of the Goodyear plant would directly impact around 550 employees. In response to this, the Malaysian government, in collaboration with Goodyear, is actively working to establish a support framework for affected workers.

This includes the implementation of upskilling and reskilling programs and facilitating job placements for those impacted by the closure.

Malaysia, facing accusations of labor abuses in various industries, including manufacturing, has been under scrutiny from its Human Resources Ministry and U.S. authorities. The government has set a target to eliminate forced labor practices by the year 2030.

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The collaborative efforts between the Malaysian government and Goodyear reflect a commitment to addressing labor-related challenges and promoting a sustainable and responsible business environment.

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