Goodyear discontinues car tyre production at French plant

ERJ staff report (RD)

Akron, Ohio - The Goodyear Tire & Rubber Co. is to discontinue car tyre production at its plant in Amiens, France, as part of its efforts to reduce high-coast manufacturing capacity globally, the company said 26 May.

“This action is a result of the plant's uncompetitive costs,” said Serge Lussier, Goodyear vice-president of manufacturing for Europe, Middle East & Africa (EMEA). “Due to high costs and weak industry demand, the consumer tyres produced there are uncompetitive in the marketplace,” he added. Lussier said that reaching a union agreement to modernise the operation was not possible.

By the third quarter of 2010, around 820 of the 1200 employees at the plant are expected to lose their jobs, the statement said. Goodyear said discontinuation of production at Amiens would result in a reduction of around 6 million units, in line with the company strategy to reduce capacity from 25 million units to 15 million units over the next two years.

The action will cost around $55 million (Euro 39 million), primarily related to cash severance payments that will be made, the company said.

Goodyear also revealed that it will “explore the divestiture" of its farm tyre businesses in EMEA and Latin America because farm tyre sales are not material to the company's net sales.

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Press release from Goodyear