Continental has announced the closure of one of their plants in Malaysia.
In a significant development affecting Malaysia’s manufacturing sector, Continental Tyre has announced plans to discontinue tire production operations at its Alor Setar plant by the end of 2025. This closure represents another blow to Malaysia’s tire industry, following Goodyear’s recent decision to shutter its Shah Alam facility.
Continental’s Decision to Close Alor Setar Operations
The Alor Setar manufacturing facility, which has been producing passenger car tires, light truck tires, and motorcycle tires primarily for the Asia Pacific market, currently employs approximately 950 workers. This production center, which began operations on December 20, 1979, has been a fully owned subsidiary of Continental since May 2012 and spans an impressive 133,000 square meters.
Continental’s announcement comes after what the company describes as a “comprehensive business review” aimed at safeguarding competitiveness and business performance in the APAC region. The decision appears to be driven by the need to adapt to changing customer demands and optimize both the local product portfolio and manufacturing footprint.
Employee Support Measures
Continental has emphasized that its priority during this transition is supporting affected employees. The company has committed to providing assistance including career counseling and exploring potential employment opportunities both within Continental and with external employers. This approach aims to minimize the social impact of the closure on the local workforce and community.
Continental’s Ongoing Commitment to Malaysia
Despite the closure of the Alor Setar plant, Continental maintains that Malaysia continues to be a key market in the Asia-Pacific region. The company has reaffirmed its commitment to customers and partners in Malaysia, stressing that long-term relationships and trust remain central to its business strategy in the country.
Continental’s Asia-Pacific Manufacturing Network
The Asia-Pacific region represents a strategic growth area for Continental, which maintains a strong tire manufacturing network serving both replacement customers and original equipment manufacturers. After the Alor Setar closure, Continental will continue to operate tire manufacturing plants in Hefei (China), Rayong (Thailand), Modipuram (India), Kalutara (Sri Lanka), and Petaling Jaya (Malaysia).
Industry Trend: Goodyear’s Shah Alam Plant Closure
Continental’s announcement follows another significant development in Malaysia’s tire industry. Goodyear Malaysia announced earlier that it will cease operations at its Shah Alam plant completely by the end of 2024. The closure is part of Goodyear’s “Goodyear Forward” transformation plan, which emphasizes cost-cutting measures across its global operations.
The Shah Alam facility, established in 1972, holds historical significance as it became Goodyear’s first tire plant to receive ISO 9002 certification in 1992. The closure will affect approximately 550 positions associated with the factory. Goodyear has maintained a presence in Malaysia since 1929, predating the formation of the nation itself.
Impact on Malaysia’s Manufacturing Sector
These consecutive plant closures by two major tire manufacturers raise questions about the future of Malaysia’s tire production industry. Industry analysts suggest that these moves reflect broader shifts in global manufacturing strategies, with companies consolidating operations to enhance efficiency and reduce costs in response to changing market dynamics and increased competition.
Looking Forward
As both Continental and Goodyear implement their closure plans, attention will focus on the effectiveness of employee transition support and the broader economic impact on Malaysia’s manufacturing sector. These developments also highlight the evolving landscape of tire manufacturing in the Asia-Pacific region, with implications for supply chains, workforce development, and industrial policy in Malaysia.
For consumers and business partners, Continental has assured that product availability and service quality will remain unaffected as the company optimizes its regional manufacturing footprint while maintaining its commitment to the Malaysian market.
