Michelin North America Inc. (MNA) will close its BFGoodrich tire manufacturing plant in Opelika, Ala., by Oct. 31, 2009, as part of a restructuring plan.
"The decision comes in the wake of the continuing economic crisis as consumers are driving fewer miles, purchasing fewer vehicles and delaying tire replacement purchases," say MNA officials.
"The dramatic drop in market demand has created significant overcapacity in the North American tire markets that Michelin does not expect to rebound in the near term."
"Business decisions that directly impact the lives of our employees are extraordinarily difficult," says Dick Wilkerson, chairman and president of MNA. "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."
The Opelika plant produces BFGoodrich and Uniroyal brand passenger car tires. At full capacity, it can produce 20,000 passenger and 6,000 light truck tire units per day, according to Modern Tire Dealer research. The factory currently employs approximately 1,000 wage and salaried workers.
MNA will consolidate production at the BFGoodrich plants in Tuscaloosa, Ala., and Ft. Wayne, Ind.
The decision "ensures the company will be better able to fully utilize the capacity of its remaining Michelin and BFGoodrich facilities in North America, accelerating work already under way to reduce costs and improve competitiveness.
"The company's strategy is to manufacture in the markets where its tires are sold. More than 85% of the tires Michelin sells in North America are manufactured in North America."
MNA says it will work with appropriate government agencies, communities, and the United Steel Workers union "to help make the transition for all affected employees as smooth as possible, including providing separation pay and other benefits."
