Yokohama may close plant in Israel

The factory for the production of tires for agricultural and other specialized equipment Alliance Tire Company in Hadera (Israel), which together with the entire Alliance Tire Group (ATG) has been owned by the Japanese Yokohama Rubber since 2016, is awaiting mass layoffs and the enterprise may be closed, reports Globes, citing its own sources.

It is noted that the threat of closure arose due to high production costs, as well as the fact that due to the attacks of the Houthis on ships in the Red Sea, the costs of delivering products, which are mainly exported outside of Israel, have increased.

According to Globes sources, the Japanese company will make a decision regarding the future fate of the Israeli plant in the near future. Currently, about 450 people are employed at the enterprise, and Igal Trichter has been the director for the last decade.

The plant's management confirmed that "the company has not yet made a final decision, and it should happen soon. When the decision is made, we will first inform the employees about it, and then make an official statement".

The Hadera plant was opened in 1950 by a group of investors from Israel and the United States in cooperation with the construction and engineering company Solel Boneh. In 1992, the company faced financial difficulties and was acquired by businessman Eliezer Fishman, and in the following year, Alliance's shares appeared on the Tel Aviv Stock Exchange (TASE). When the financial situation of the tire manufacturer improved, Fishman sold Alliance to the private investment firm Warburg Pincus for $50 million in 2007.

Subsequently, Alliance relocated part of its production to India, while in Israel, the production of agricultural tires, which require a higher level of technology, continued. In 2013, Warburg Pincus sold Alliance to another investment firm, KKR, for $600 million, and in 2016, the new owner became Yokohama, which paid almost $1.2 billion for the company.

ATG produces tires for agricultural, industrial, construction, and forestry equipment and in 2016 supplied products to 120 countries around the world, primarily to North America and Europe. Yokohama did not have a presence in the segment of tires for special equipment before acquiring ATG.

Photo: yazamoot.co.il.