In the face of slower growth, Japan’s Asahi Kasei has decided to discontinue the business of Asahi Kasei Cord Co and liquidate the company. Asahi Kasei Cord was established in 1970 as a manufacturer of nylon yarn for tyre cord (reinforcing fabric in tyres) and has played an important role as a manufacturing and supply base for Asahi Kasei’s nylon filament business. The company will cease production in March 2024 and the plant in Hyuga City, Miyazaki, Japan, will close in March 2025.
In recent times, the market environment for tyre cord in Japan has become increasingly difficult due to the sluggish growth of automobile production as well as increased imports of products from other countries.
In addition, the recent sharp rise in raw material and fuel prices has led to increased costs, resulting in a significant deterioration in earnings.
As part of its ongoing business portfolio transformation, Asahi Kasei has decided to shift its nylon filament management resources from general-purpose tyre cord applications to airbag and specialty tyre cord applications, where further growth is expected, in order to improve profitability and achieve further growth.
The impact on Asahi Kasei’s consolidated financial results is immaterial, it adds.