Dow to shut three European assets to boost profitability by 2029.

Dow has announced the shutdown of three upstream assets in Europe, as well as certain corporate and other assets globally, to reduce merchant sale exposure and remove higher-cost, energy-intensive assets. The shutdowns are expected to result in Op. EBITDA uplift starting in 2026, reaching 50% of the ~$200 million target by end-2027 and full delivery by 2029. The moves are part of Dow's efforts to support European profitability and right-size upstream regional capacity.

Dow Inc. (NYSE: DOW) has announced the shutdown of three upstream assets in Europe, along with certain corporate and other assets globally, as part of its strategic efforts to enhance profitability and right-size regional capacity. The moves, which were approved by the company's Board of Directors, are aimed at reducing merchant sale exposure and removing higher-cost, energy-intensive assets from the portfolio.

The shutdowns will commence in mid-2026 and are expected to be completed by the end of 2027, with potential decommissioning and demolition activities continuing into 2029. The specific assets to be shut down include:

- Ethylene cracker in Böhlen, Germany, expected to shut down in the fourth quarter of 2027.
- Chlor-alkali and vinyl (CAV) assets in Schkopau, Germany, also expected to shut down in the fourth quarter of 2027.
- Basics siloxanes plant in Barry, U.K., scheduled to shut down mid-year 2026.

These actions are part of a broader initiative announced in April 2025, which aimed to rationalize the company's global asset footprint and improve operational efficiency. The expected outcomes include an Operating EBITDA uplift beginning in 2026, ramping to 50% of the approximate $200 million target by year-end 2027, and full delivery by 2029. The cash outlay for these actions is estimated to be approximately $500 million over four years.

The shutdowns are expected to have a significant impact on the company's workforce, with approximately 800 roles being affected. These roles are in addition to the $1 billion cost savings actions announced in January that included a workforce reduction of approximately 1,500 roles globally. Dow will involve local stakeholders in the process and ensure compliance with relevant information and consultation processes.

The company's CEO, Jim Fitterling, stated that the industry in Europe continues to face challenging market dynamics and cost landscapes. Dow's commitment to operating with a best-owner mindset and taking proactive actions across higher-cost or non-strategic assets remains a key focus. The company aims to realize the value of its incremental growth investments and enhance profitability and cash flow through these strategic actions.

Dow's actions are expected to result in charges ranging from $630 million to $790 million, including non-cash items such as asset write-downs and write-offs, and cash items such as exit and disposal of assets, as well as severance and related benefit costs.

References:
[1] https://www.prnewswire.com/news-releases/dow-will-shut-down-three-upstream-european-assets-in-response-to-structural-challenges-in-the-region-302498710.html