This planned closure and consolidation is part of the company’s overall plan to rationalise its wholly owned manufacturing facilities, said GPX in a statement. These plans will see North American operations focusing on specialty products whilst the plant in China will produce the “longer run commodity type” products.
The company has been operating its North American facilities only four days a week, an unfortunate situation made necessary by strong competition from Sri Lanka and a weakening industrial tyre market. It expects that, by closing the factory in Canada, the facility in the Maine will be able to return to a five-day working week. Such an arrangement will require an expansion of production capacity at the Gorham plant as well as additional employees. GPX will further equip the factory with both machinery from the facility in Canada and newly purchased equipment.
The manufacture of commodity type tyres currently undertaken in Canada will be transferred to the solid tyre factory at the company’s StarBright production facility in China, and the wheel production currently carried out there will be moved to GPX’s specialty wheel factory in Red Lion, Pennsylvania.
These steps, says the company, will allow GPX to both reduce costs in the North American market and better serve its client base. By moving production of its price sensitive commodity type products to China, GPX will be able to better compete with the entry level tyres and products imported from Sri Lanka. At the same time, by expanding the facility capabilities in both Maine and Pennsylvania, GPX believes it will be able to maintain fast response times when it receives orders for specialty products. Most of the production in GPX’s Gorham facility is made to order and turn around time for specialty products is usually two to three days. This, GPX believes, gives solid tyre customers the best of both worlds; competitive prices and just-in-time order fulfilment. Following Monarch/Trelleborg’s decision to close its Hartsville, Ohio solid tyre production facility, GPX will be one of the last remaining producers of solid tyres in the United States.
GPX will systematically begin phasing out production at the Mississauga facility during the first half of the year. The transition of equipment and production to Maine, Pennsylvania and China is scheduled to be completed by the end of June 2008. (Tyres & Accessories/Staffordshire, U.K.)
