Goodyear cuts 500 French jobs over costs

Businessweek, January 24, 2008

Goodyear Tire & Rubber Co. said Thursday an uncompetitive cost structure will force its European Union business unit to cut 500 jobs and reduce tire production at two factories in Amiens, France.

The company said the move follows an October rejection by employees of Goodyear plans to modernize and renovate the plants. Goodyear employs about 3,800 people in France, of which 2,700 are in the Amiens plants.

"We have communicated extensively with the trade unions, explaining the need for major changes. These changes would increase our competitiveness. Unfortunately, they have rejected the plan to improve competitiveness. Therefore, we have no choice but to reduce our costs as the plants are currently uncompetitive," said Serge Lussier, Goodyear's Europe, Middle East and Africa vice president of manufacturing.

Goodyear said some tire production will be outsourced to lower-cost factories in Europe and elsewhere. Some products will be eliminated.

Lussier said the plan presented in October required investment of about $75 million across the two plants in large part to facilitate the supply of high performance tires. The new required work pattern would have involved four rotating crews working eight-hour shifts, including weekends, for 350 days a year.