Dow (DOW.N), will close it’s three upstream plants in Europe and cut round 800 jobs in response to structural challenges in the region, the chemicals enterprises stated on Monday, sending its shares down 2.5% in morning trade.
The enterprise stated the shutdowns will remove away higher-value, energy-extensive portions of Dow’s portfolio in Europe.
Global chemical enterprises are feeling the pressure to reassess techniques, with the European Union’s rising manufacturing prices, lackluster demand and stringent environmental policies.
Last year, Dow had stated that it had started a review of some of its European assets.
An Ethylene cracker in Böhlen, Germany, Chlor-alkali & vinyl assets in Schkopau, Germany and a Basics siloxanes plant in Barry, UK will be close within the next two years, the chemicals enterprise stated on Monday.
The Midland, Michigan-primarily based enterprise stated the 800 affected jobs is similarly to the reduction of about 1,500 Dow roles, declared in January as part of a $1 billion cost savings plan.
The enterprise had almost 36,000 employees as of September 2024.
“While this decision is expensive and could take some time to play out, we saw this as positive for Dow given the run-rate EBITDA and free cash with the flow advancement,” stated TPH Energy Research analyst Matthew Blair.
Such actions have to improve the balance between deliver and demand in the commodity chemical market, Blair added.
Dow will record charges starting from $630 million to $790 million, for items which includes disposal of assets and severance.
The shutdown is anticipated to start in mid-2026 and is predicted to be finished by the end of 2027, with capacity decommissioning and demolition to stretch into 2029 as needed, the enterprises added.
In April, Dow had said it expects extended pressure on earning because of uncertainty from U.S. President Donald Trump’s shifting trade policies.
