DOW JONES NEWSWIRES
Goodyear Tire & Rubber Co. (GT) will buy out 550 workers and
reduce production at a plant in Tennessee to match its operations
to lower demand.
The recession has slashed sales almost 30% as consumers and auto
makers skipped purchases or cut orders.
On July 6, Goodyear's consumer tire plant in Union City, Tenn.,
will change from continuous operations to a five-day, three-shift
operation. The cuts represent just less than a quarter of the 2,300
employees at the plant.
United Steelworkers members at the plant approved the change
early last month.
The tire manufacturer expects to record about $60 million in
restructuring charges related to the moves. Most charges will be
posted in the second quarter, though the cash severance payments
will be paid primarily in the third quarter.
In April, Goodyear said it swung to a first-quarter loss on
lower sales and rising raw material prices. The company cut 3,800
jobs during the first quarter.
Goodyear's shares closed Friday at $12.23, up 1.2%, and were
inactive after hours. The stock has lost about 40% of its value in
the past nine months.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975;
Kathy.Shwiff@dowjones.com
