Westlake plans North American chlorovinyl and styrene asset closures, maintaining supply from other facilities while incurring significant restructuring costs.
Westlake Corporation has announced a strategic decision to rationalize certain assets within its North American chlorovinyls and styrene operations as part of a broader response to prolonged and challenging market conditions in the global commodity chemicals sector. Despite these planned closures, the company emphasized that it will continue to reliably serve customers by supplying PVC, vinyl chloride monomer (VCM), and chlor-alkali products from its remaining seven chlorovinyl manufacturing facilities across North America.
Following the implementation of these changes, Westlake expects to maintain substantial production capacity across its global operations. On an aggregate basis, the company anticipates annual capacity of approximately 5,520 million pounds of suspension polyvinyl chloride (PVC) worldwide, with around 4,900 million pounds produced in North America. In addition, global VCM capacity is projected to reach about 7,630 million pounds annually, including roughly 6,050 million pounds in North America. The company’s chlor-alkali footprint is also expected to remain significant, with global annual production capacity of approximately 6,680 million pounds of chlorine and 7,510 million pounds of caustic soda. Of these totals, North America is expected to account for around 5,410 million pounds of chlorine and 6,100 million pounds of caustic soda each year.
In parallel with the chlorovinyl rationalization, Westlake has approved a plan to shut down its styrene production facility located at its site in Lake Charles, Louisiana. This styrene plant currently has an annual production capacity of approximately 570 million pounds. The decision to cease operations at this unit reflects the same disciplined review of asset performance and market dynamics that guided the chlorovinyl-related closures.
The cessation of operations at the affected facilities is expected to occur in December 2025. As a result, the company anticipates a workforce reduction of approximately 295 employees. Westlake acknowledged the human impact of this decision and stated that it is committed to supporting affected employees through the transition process, including providing severance and separation benefits.
From a financial perspective, Westlake expects to incur total pre-tax charges of approximately $415 million related to the facility closures. The majority of this amount—around $357 million—will consist of non-cash charges, including accelerated depreciation, amortization, and asset write-offs. In addition, the company estimates employee severance and separation costs of approximately $25 million, along with about $33 million in other plant shutdown-related expenses. While a substantial portion of these charges is expected to be recognized in the fourth quarter of 2025, the associated cash outflows are projected to occur over several years as the closures are fully executed.
Commenting on the announcement, Westlake President and Chief Executive Officer Jean-Marc Gilson noted that persistent weakness in global commodity chemical markets necessitated difficult but necessary decisions. He reiterated that Westlake will continue to serve its chlorovinyl customers using production from its remaining North American facilities and expressed appreciation for the dedication and contributions of all employees, particularly those impacted by the closures.
Overall, the asset rationalization reflects Westlake’s effort to align its manufacturing footprint with prevailing market realities, strengthen long-term competitiveness, and preserve financial flexibility, while continuing to meet customer demand through its remaining, more competitive production assets.
