Bridgestone Corp., the world’s biggest maker of tires, plans to extend output cuts as Europe’s debt crisis and China’s slowdown curb demand, Bloomberg reports.
“In Europe, we reduced production through the second quarter as demand was lower than we expected, and if necessary, we may continue to do so in the third and fourth quarter as well,” Masaaki Tsuya, Bridgestone’s chief executive officer said.
The announcement comes a week after the European Union’s statistics office in Luxembourg said Euro-area industrial production declined for a second month in April, led by a drop in Germany, adding to signs of a deepening economic slump.
Output in the 17-nation euro area slipped 0.8 percent from March, when it fell 0.1 percent.
“The debt crisis in Europe and slowing growth in China are clouding market sentiment and have raised concerns that demand for rubber may slow,” said Chaiwat Muenmee, an analyst at Bangkok-based commodity broker DS Futures Co.
Earlier this month, the company reported a 34.7% rise in net profit to Y42.2 billion for the January-March quarter, as solid sales in emerging markets offset the yen’s strength and high raw materials prices.