Dow Shutting Three European Chemical Plants

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Chemical major Dow Incorporated (Midland, Michigan) has announced the closure of three plants in Europe with the loss of around 800 jobs.

The company blamed "structural challenges" in the region for its decision to shut its ethylene cracker in Böhlen and its chlor-alkali and vinyl (CAV) assets in Schkopau, Germany, by the end of 2027, as well as its basics siloxanes plant in Barry in the U.K. by mid-2026. The move follows through on the company's plan announced earlier this year to cut costs by US$1 billion and reduce its global headcount by 1,500. The decision highlights the difficulties many European chemicals companies are facing, including high energy and materials costs, tough environmental legislation and weakening demand. In recent weeks, Saudi Arabian manufacturing and chemicals firm, Sabic, announced the planned closure of its Olefins 6 cracker plant in Wilton, Teesside in the U.K., with the potential loss of more than 300 jobs.

"Our industry in Europe continues to face difficult market dynamics, as well as an ongoing challenging cost and demand landscape," said Jim Fitterling, Dow chair and chief executive officer. "Over the past decade, we have demonstrated Dow's commitment to operating with a best-owner mindset by taking proactive actions across higher-cost or non-strategic assets. Looking ahead, we remain committed to realizing the value of our incremental growth investments and enhancing profitability and cash flow through more than $6 billion in near-term cash support."

Dow maintained that the closures will "right-size regional capacity, reduce merchant sale exposure, and remove higher-cost, energy-intensive portions of Dow's portfolio in the region". Industrial Info is tracking almost 3,000 chemical projects in Europe worth a potential US$191 billion in investment. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here for the reports.

Europe's chemical industry has been calling on the European Union (EU) for urgent action to help stop the decline of the sector in recent years. The region's main chemical sector group, CEFIC, warned that the chemical industry is at a "tipping point". Rising energy costs, regulatory burdens, and intensifying global competition are threatening the sector's survival, according to Dr. Ilham Kadri, chief executive officer of Syensqo and President of CEFIC and ICCA. Speaking to ICIS earlier this year, she pointed out that energy costs in Europe are four to five times higher than in competing regions, that over 11 million tonnes of chemical production capacity closures were announced for 2023-2024 period and that Europe's market share in chemicals had fallen 11% in a decade, while China had gained 9%. "There is no strong economy without strong industry. And there is no strong industry without a strong chemical industry," Kadri said. "Representing 5-7% of EU manufacturing turnover, the chemical sector employs millions and is crucial to Europe's ambitions for climate neutrality and circularity."

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).