Bandag says that over the past decade, the demand in the European retread market dropped by 30%.
Bandag Europe NV (Bandag) has announced its intention to close its retread production plant in Lanklaar, Belgium, around the first half of 2025. Bandag says in the last ten years the European retread market has seen a significant decrease resulting in production overcapacity and uncompetitive production costs and, consequently, the company says it has “no other option than to take structural measures.”
Over the past decade, the demand in the European retread market dropped by 30%, predominantly driven by the import of low-cost truck and bus tires from East Asia, Bandag says, adding its sales continued to decline in Europe, resulting in significant production overcapacity and increasing and uncompetitive production costs. These costs have been further impacted by the high energy prices and subsequent inflation.
Over the years, the company says it has taken initiatives to address the structural issues in its retread business, amongst others with a transformation plan for its Belgian production site in Lanklaar in 2021. However, since then, the market has seen an even sharper decline. Given the present market conditions, Bandag says it must take structural measures to bring the retread business back to profitability and secure its sustainability over time.
Bandag says a consolidation of the European production footprint to ensure alignment with market conditions therefore appears to be unavoidable. After careful analysis, Bandag says considering cost optimization as well as current and future production capabilities, centralizing production at one location, specifically Stargard (Poland), is considered “the only remaining option” to ensure a future for the company’s retread business in Europe. Accordingly, Bandag is starting the information and consultation process with the intention to close the Lanklaar plant around the first half of 2025. Bandag currently employs 111 people in this plant.
