Westlake to cease chlorovinyl, styrene productions in the US in major restructuring

Westlake Corporation announced on Monday a comprehensive rationalisation plan to cease operations at several North American chlorovinyl and styrene production facilities by December 2025. The decision, driven by "persistent, challenging market conditions," will see the removal of approximately 454,000 tons/year (1 billion pounds) of suspension PVC capacity and the company’s complete exit from styrene (SM) manufacturing at its Lake Charles site.

The closures specifically target older, less efficient assets within the company’s Performance & Essential Materials segment, including the suspension PVC plant in Aberdeen, Mississippi, and diaphragm-grade chlor-alkali units in Lake Charles, Louisiana.

Following the mothballing, Westlake’s remaining North American PVC capacity will stand at approximately 2.22 million tons/year (4.9 billion pounds). The company emphasised that it would continue to supply customers from its seven other chlor-vinyl facilities.

Westlake North American Plant Closures (Dec 2025)

The rationalisation is expected to result in a workforce reduction of approximately 295 employees. While significant for the affected sites, this represents less than 2% of Westlake's global workforce of approximately 16,000 employees. The company projects total pre-tax costs of approximately $415 million related to the closures, primarily consisting of non-cash accelerated depreciation and asset write-offs ($357 million).

This development marks a significant tightening in the North American vinyls balance heading into 2026, but it also signals a strategic shift toward higher vertical integration.

As the second-largest PVC pipe manufacturer in North America, Westlake’s Housing & Infrastructure Products segment consumes massive volumes of resin internally. By removing 454,000 tons of upstream capacity, Westlake is effectively reducing its exposure to the merchant resin market (selling pellets to competitors or traders) while likely retaining sufficient volume to feed its own critical downstream pipe and fittings operations.

The move allows Westlake to optimise its portfolio by focusing on "One Westlake" finished goods—like siding, pipe, and windows—which typically command more stable margins than the volatile upstream commodities it is exiting.

Written by: Aiman Haikal