KUALA LUMPUR: The Ministry of Investment, Trade, and Industry (MITI) and the Malaysian Investment Development Authority (MIDA) are taking proactive measures regarding Goodyear's plan to shutter its Shah Alam manufacturing facility.
In a statement released today, they clarified that Goodyear and its shareholders had collaborated closely with the government before the decision was made public.
"This intervention is a testament to our unwavering commitment to supporting our local workforce through transformative industrial changes, drawing on previous successful collaborations with companies undertaking similar rationalisation as part of their business plans for closure or downsizing, ensuring workers are well-positioned for new and fresh job opportunities."
Established in 1972, the Shah Alam factory has been a cornerstone of Goodyear's presence in Malaysia, signifying the company's longstanding commitment to the regional economy and automotive sector.
The closure of the Shah Alam plant, in operation for 52 years, effective June 30, will impact approximately 550 workers.
Nathaniel Madarang, Goodyear Asia Pacific president, said that the Shah Alam plant closure is part of the 'Goodyear Forward' transformation program aimed at optimising the company's operations and portfolio, achieving substantial margin expansion, and enhancing shareholder value.
In a widely circulated memo on social media platforms, Madarang emphasised that the program entails specific measures to achieve annualized cost reductions of US$1 billion by 2025, ensuring Goodyear's competitiveness and leadership in the industry.
According to MIDA, Goodyear has been operating at a loss since 2017, prompting a strategic shift towards optimising its operations.
As part of its restructuring, the company has indicated plans to transition from manufacturing to a distributor business model, focusing on premium profitable segments, building capability in sales and marketing, strengthening the distribution network, and improving the cost structure.
"Goodyear emphasised its commitment to managing this transition with the highest regard and transparency for all of its employees and associates," MIDA said.
The government, through initiatives led by MITI and MIDA, has mobilised specialised team to facilitate job placements, as well as offering upskilling and reskilling programmes to mitigate the impact on the affected workforce in Goodyear.
"This situation underlines the importance of MITI and MIDA's commitment to supporting affected workers and fostering resilience. This also reflects our adaptability and determination to secure the well-being of the workforce and the economic vitality of the nation.
"In helping affected parties with job placement, previous efforts have been shown to be effective, turning challenges into opportunities," said MIDA.
Leveraging its experience, MIDA has actively engaged with PERKESO and Jabatan Tenaga Kerja through the newly formed Invest Malaysia Facilitation Centre to facilitate job placement assistance for employees from various sectors.
MIDA said that this collaborative effort underscores the potential for similarly effective support mechanisms to be extended to those affected by Goodyear's Shah Alam plant closure, demonstrating a committed approach to workforce transition and resilience.
Meanwhile, MITI and MIDA said they would highlight the ongoing strategic dialogue between them and Goodyear.
"This pre-emptive collaboration demonstrates our collective commitment to the well-being of the workforce, underscoring that our efforts to assist the affected employees are undertaken with foresight and responsibility."