Michelin to shut BFG plant in Alabama by Oct. 31

ERJ staff report (TB)

Opelika, Alabama -- Michelin North America Inc. (MNA) will close its BFGoodrich Tire Manufacturing plant in Opelika by Oct. 31 in response to an “unprecedented drop in market demand.”

The 46-year-old Opelika plant makes BFG- and Uniroyal-brand passenger tyres with approximately 1000 wage and salaried workers. Capacity is listed at 14 000 units daily, although Michelin already has rolled that back somewhat in recent months.

Michelin will consolidate production at the BFG plants in Tuscaloosa, Alabama, and Fort Wayne, Indiana.

Michelin said the drop in demand - attributed to consumers' driving fewer miles, purchasing fewer vehicles and delaying tyre replacement purchases - has created “significant overcapacity” in North America, and the firm does not not expect demand to rebound in the near term.

“Business decisions that directly impact the lives of our employees are extraordinarily difficult,” said MNA Chairman Dick Wilkerson. “This action is necessary, however, for the long-term health and competitiveness of Michelin North America. In this crisis, there is no more business as usual.”

Michelin said the decision ensures it will be better able to fully utilise the capacity of its remaining Michelin and BFG plants in North America, accelerating work already under way to reduce costs and improve competitiveness. Michelin said it makes in North America more than 85 percent of the tyres it sells in North America.

The company will work with appropriate government agencies, communities and the United Steelworkers union to help make the transition for all affected employees as smooth as possible, including providing separation pay and other benefits.

MNA said it is establishing a Michelin Development Program to assist in the creation of new jobs from diverse industries within the local community. Details of this initiative will be released in the coming weeks.

From Tire Business (A Crain publication)

Press release from Michelin