Strike cost Goodyear up to $35 million per week

Akron, Ohio -- The nearly three-month strike at 16 Goodyear production plants in North America cost the company $30 million to $35 million per week in the fourth quarter, according to Richard Kramer, the tyre maker's executive vice president and chief financial officer.

The negative impact on the company was primarily due to lower production volume and lost sales, Kramer said. Lost sales and other costs also will linger into the first half of 2007, he said.

Kramer and other company officials, including Robert Keegan, Goodyear chairman and CEO, discussed the impact of the 86-day strike by the United Steelworkers during an investor conference call Jan. 9. More details about the strike´s effects on the fourth quarter and in 2007 will be revealed during the company´s year-end conference call in February.

Keegan said by the end of the strike -- workers ratified a new three-year dealon 28 Dec. -- the affected plants were running at about 60 percent of normal production levels. Those North American Tire and Engineered Products facilities should be operating at pre-strike levels by the end of January.

The company is pleased with how the reintegration has progressed and has been working with customers individually to make sure their needs have been met, said Jonathan Rich, president of the North American Tire business unit.

Goodyear reiterated that it expects to save about $610 million over the life of the three-year contract, which runs until 22 July, 2009, and ongoing savings of $300 million per year.

From Rubber & Plastics News (A Crain publication)