Sumitomo Rubber eyes €175m cost-savings with reorganisation project

Kobe, Japan – Sumitomo Rubber Industries (SRI) has outlined plans to tackle the impact of US tariffs on its operations as well as new cost-cutting measures which will enable savings of up to Yen30 billion (€175 million) over the next two years.

In a 7 Aug first-half presentation, the Japanese group lowered the projected impact of US automotive tariffs from a May estimate of Yen18 billion in 2025 to Yen14.5 billion.

This, the group said, was due to factors such as partial postponement of the tariff implementation and the agreements to reduce the rates of tariffs for products originated in Japan and Indonesia.

Furthermore, SRI said it intended to partially absorb the impact by price pass-through as well as “internal factors”.

The ‘internal factors', SRI explained, include ‘project ARK’ which aims to cut costs by Yen30 billion by the end of 2027.

The project involves reviewing SRI’s total costs and expenses, which currently stand at Yen1,100 billion.

The group expects to save Yen14.5 billion within its Tires Business, through reducing raw material costs, optimising factory operations, optimising logistics and reducing manufacturing costs.

Furthermore, the group expects to optimise the division’s expenses to save Yen5 billion.

Another Yen4 billion of savings is to be achieved in the sports and industrial divisions, while the administrative function will see a cost-cutting of Yen6.5 billion through the optimisation of HQ personnel and organisation.

SRI said it will promote the use of artificial intelligence, digitalisation and waste elimination to achieve the saving targets.