Plymouth Rubber to Shift Production from Massachusetts Plant

Plymouth Rubber Company has announced plans to discontinue manufacturing operations at its Canton, Massachusetts facility within three years. Production will be transferred to other locations, including China. The Canton site currently employs approximately 350 people, of whom approximately 275 would be affected by the decision, beginning sometime in 2006.

In December, 2004, Plymouth and Hebei Huaxia Group announced the formation of a joint venture, Plymouth Yongle Tape (Shanghai) Co., Ltd., to manufacture PVC tapes in China. The joint venture is currently constructing a new factory near Shanghai, China. It is expected to be in operation within a few months.

Plymouth will continue to manufacture tapes at its other facilities in the US and Europe. It also plans to expand its Materials Research and Product Development activities at a new Technical and Sales facility to be located in or near Canton, MA.

In discussing the shift, Plymouth President and CEO Maurice Hamilburg commented, "Our products' market prices are now determined globally, while their costs are determined locally. Although we believe that Plymouth manufactures the best PVC electrical and auto harness tapes in the world, it has become extremely difficult to compete profitably from our current location against PVC tapes manufactured in Asia. We have resisted this trend for several years, but ultimately have concluded that this change in strategy is necessary for our survival as a manufacturer. We think that the combination of Plymouth's technology and quality with the Chinese cost structure will be unbeatable in the marketplace."

Plymouth also plans to move production of its rubber tapes and extrusions from Canton, MA, to a new location, either in the US or in China, within the same three-year timeframe. Mr. Hamilburg said, "Our history in rubber tapes goes back over 100 years, and for some unique products, Plymouth is the only producer in the world. Rubber tapes will remain a core business for us."

The Company's 40-acre Canton site -- which Plymouth has occupied since 1910, and which has been utilized for manufacturing since Paul Revere built the US's first copper mill there in 1802 -- will be freed for development or other use. The Company is currently seeking re-zoning of the property to permit residential or mixed-use development in the future.

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