Tyson Foods Plans on Shutting Down Two US Chicken Plants
According to an announcement released on March 14, 2023, Tyson Foods Inc plans on shutting down two United States chicken plants with nearly 1,700 workers on May 12.
Tyson is the biggest meat company in the United States and will shut the doors of a plant in Glen Allen, Virginia with 692 employees and a plant in Van Buren, Arkansas that boasts 969 employees, per a statement.
The company announced that the chicken demand will shift to other plants as part of a new strategy to tap into the full capacity of all of its facilities.
“The current scale and inability to economically improve operations has led to the difficult decision to close the facilities,” Tyson stated.
In 2022, Tyson said that it could not carry out all of its orders for chicken because of limited supplies and labor, and planned to increase production. In order to meet demand on a previous occasion, Tyson purchased chicken from other producers.
Tyson sales have recently underwhelmed analyst expectations. Sales for the quarter ending on December 31, 2022 witnessed total operating margins falling from 11.3% in 2022 to 3.5%.
As of October 1, 2022, Tyson had 124,000 workers based in the United States, which includes 118,000 workers at non-corporate locations such as meat plants, per revelations from regulatory filings. Back in October, the company announced that it plans to relocate all of its corporate workers to its headquarters in Springdale, Arkansas.
Indeed, Tyson very likely has management issues. But there’s an elephant in the living room in this discussion that people generally ignore: The US’s bloated regulatory state. Excessive amounts of regulation make it harder for businesses to stay afloat or at least fire on all cylinders.
At times, these regulations compel businesses to scale back operations, and in worst cases, shut their doors completely. If the US wants to boast a robust economy, it must roll back the regulatory state and allow for markets to operate smoothly.