Westlake will close its polyvinyl chloride (PVC) plant in Cologne, Germany, citing weak demand, elevated energy costs and increased import pressure from Asia.

The plant has annual PVC production capacity of approximately 165,000 metric tons. Westlake expects the facility to cease operations in the first quarter of 2027 and plans to continue supplying customers from its other German PVC facilities, including the recently acquired Wilhelmshaven site.

Westlake said the Cologne plant's smaller scale and higher logistical costs make it more expensive to operate than its other European PVC facilities.

The company expects to record approximately $205 million in total pretax charges related to the closure, including about $100 million in cash charges and $105 million in noncash charges. Approximately $110 million of the charges are expected to be recorded in 2026, with the remainder in 2027.

“Given the persistent, challenging market conditions facing the global chemical industry, we have made the difficult decision to cease operations at our Cologne, Germany PVC site as part of our ongoing optimization of business operations,” Jean-Marc Gilson, Westlake president and CEO, said in a statement.

Westlake will retain PVC production at its other German facilities. In June, the company completed its acquisition of a PVC and vinyl chloride monomer (VCM) production site in Wilhelmshaven, Germany, which has annual PVC capacity of 380,000 metric tons. Westlake said the site’s deep-water dock provides logistical advantages for raw-material supply.

The Cologne closure follows Westlake's shutdown of several North American chlorovinyl and styrene facilities in December 2025. Those actions included a PVC plant in Aberdeen, Miss., a VCM unit and chlor-alkali unit in Lake Charles, La., and a styrene plant at the company's Lake Charles complex. Westlake said the closures would allow it to continue supplying customers from its remaining North American chlorovinyl facilities.

Westlake also completed its acquisition of ACI's global compounding solutions businesses in January. The deal added production facilities in Portugal, Romania and Tunisia to Westlake's global compounds operations and expanded its specialty materials portfolio.

Why it Matters

Westlake's decision adds another capacity reduction to a European chemical industry that continues to operate below historical utilization levels. Cefic reported in September that EU27 chemical capacity utilization remained around 75% during the first half of 2026, while weak demand, elevated energy costs and competitive pressures continued to weigh on production. Polymers and other organic basic chemicals were among the weaker-performing segments.

The broader capacity picture is also changing. A Cefic study published in January found that announced European chemical plant closures from 2022 through 2025 represented about 37 million metric tons of production capacity, or roughly 9% of European chemical capacity. Energy-cost competitiveness was identified as the primary rationale in 49% of the closure cases analyzed.

Westlake's European chlorovinyls portfolio illustrates both sides of that restructuring. The company is closing the smaller Cologne PVC operation while retaining production at other German sites and adding the 380,000-metric-ton-per-year Wilhelmshaven PVC/VCM operation. The Wilhelmshaven acquisition gives Westlake additional capacity and deep-water logistics within its European chlorovinyls network.