Homegrown tyre major Apollo Tyres stated it will cut 750 jobs at its plant in the Netherlands over a period of two years in order to have a “sustainable business” and focus on producing only high-value tyres. Apollo Tyres had acquired Vredestein Banden BV (VBBV) for an undisclosed sum in 2009 from Russia’s bankrupt largest tyre manufacturer Amtel-Vredestein NV.
Apollo Vredestein BV (AVBV) had a meeting with its employees to discuss the future of the plant in Enschede and the company’s plans to build a more sustainable business in the Netherlands. In this direction, AVBV aims to specialize in the production in Enschede to a level where only high-performance Vredestein tyres will be produced at a profitable level, it added.
In a statement, Apollo Tyres said,“ Aligning the plant to the intended specialized and sustainable production level, will, unfortunately, result in AVBV having to reduce its workforce in the Netherlands by around 750 full-time employees, over a period of 24 months.”
Explaining the reason behind the move, the company said: “Within the current operating environment certain tyre sizes can no longer continue being produced in Enschede at a sustainable and competitive level. The company, therefore, intends to specialize the plant towards high-value tyres and to secure a sustainable future in the Netherlands.”
Apollo Vredestein President Benoit Rivallant also added that the operating environment for AVBV and the entire tyre industry has changed significantly over the last few years.
Despite large investments made in recent years in modernizing the plant, the factory employees’ dedication and continuous efforts to make the site economically viable has proved ineffective against the accelerated market transformation and has mandated a strategic adaption of the site to secure it has a sustainable future in the long run, he added.
The tyre maker’s decision comes after a deep analysis of the profitability and sustainability of the products currently produced in the Enschede Plant. Nonetheless, the company is aware that its employees and their families will face a great deal of uncertainty as a result of this difficult decision. Hence as a responsible employer it will comply with all statutory obligations towards its employees and offer them all necessary support and assistance. While the tyre maker aims to specialize the Enschede plant in order to make the business sustainable, it is imperative that employees undergoing this transformation currently are offered full support to tide over these difficult times.