Goodyear Cut Production Hours in Response to Weak Market

The Goodyear Tire & Rubber Company is taking another important step in its efforts to align North American production capacity with weak industry demand. The company's consumer tire plant in Union City, Tenn., will move from a continuous operating schedule to a five-day, three-shift operation on July 6.

In early May, United Steelworkers (USW) members at the plant ratified a local labor agreement that permits the schedule change. Approximately 550 associates will receive buyout packages as part of the change.

The Union City plant can produce about 12 million consumer tires a year for the original equipment and replacement markets and currently employs about 2,300 associates.

The company expects to record after-tax restructuring charges associated with this action of approximately $60 million primarily in the second quarter of 2009, which relate to cash severance payments that will be paid primarily in the third quarter.