Goodyear Tire & Rubber Co. today announced plans to close its manufacturing facility in Tyler, TX during the third week of a United Steelworkers (USW) strike affecting 16 Goodyear plants. Goodyear said the closure is “part of its previously announced strategy to exit certain segments of the private-label tire business.”
The tire company declined to set a date for the closure, saying that “the timing…would be coordinated to minimize the impact on Goodyear’s customers.”
The plant manufactures small-diameter passenger tires—a segment that’s under a lot of cost pressure from low-cost foreign competition, Goodyear said. The plant has produced 25,000 passenger and light truck tires per day, the company added.
Goodyear expects to eliminate 1,100 jobs, create an annual savings of $50 million after taxes and receive a restructuring charge of up to $165 million after taxes.
“We must take the steps necessary to reduce our costs and improve our competitive position,” said Jon Rich, president of Goodyear’s North American Tire business. “[This decision] was required to help turn around our North American business.”
The United Steelworkers condemned Goodyear’s decision to announce the plant closing.
“Now they seem committed to stripping away health care benefits…and to further close plants and abandon the business,” said USW vp Tom Conway.
On Oct. 5, USW called a strike against Goodyear that involves 15,000 USW members, 12 U.S. plants covered under the master labor agreement and four additional facilities in Canada.
In spite of the large scale of the strike, The Wall Street Journal reported last week that Goodyear’s stock remained relatively stable since based on investor confidence that USW will make big concessions and falling oil prices.
To comment on this article, write to Terrence Nguyen at email@example.com