The Goodyear Tire & Rubber Company has ceased production at its tire manufacturing facility in Union City, TN, as of this month, well ahead of its plans to shut down the plant by year’s end.
“When we announced our intention to close the plant, we expected the shutdown would occur by year-end," said Richard Kramer, chairman & CEO. “Since then, the product transfers to the other Goodyear plants have been completed more quickly than expected.”
The factory closure is part of a larger reinvestment strategy announced by the company back in March. Going forward, Goodyear said it anticipates making capital investments of between $1.1 and $1.3 billion per year in 2012 and 2013, up slightly from an expected $1.1 to $1.2 billion in 2011.
Between $500 million and $600 million each year will be focused on profitable growth opportunities through plant modernizations, expansions and new construction, the company said. These investments will lead to what the company believes will be a 3 to 5% annual increase in unit volume, focused on high-value-added tires in high-margin segments.
As a result of the accelerated plant closure and payments to approximately 1,800 associates under the federal Worker Adjustment and Retraining Notification Act, Goodyear expects to record additional after-tax charges of approximately $20 million, primarily in its second quarter.
The Union City plant saw decreased production start in 2009 when Goodyear trimmed production from 24 hours a day, seven days a week, to just five-day-a-week production, laying off 550 at that time.
