Bandag Inc. plans to phase out production at its Shawinigan, Quebec, tread rubber manufacturing plant by the end of June.
Bandag says its manufacturing teams have been increasing efficiency and implementing process improvements throughout its North American manufacturing network. "As a result, the Bandag manufacturing team has thoroughly evaluated tread capacity and capabilities and concluded they must phase out production at the Shawinigan plant."
The Canadian plant has the lowest product output of Bandag's North American plants, according to the company. Its production "can easily be absorbed" by Bandag's larger North American plants, which will improve overall plant capacity utilization.
Bandag says it remains fully committed to its Canadian dealers, fleet customers and the Canadian marketplace in general. Canadian dealers will continue to receive their tread products from the same distribution centers they do today. One of the centers is located in Long Beach, Calif.
The phase out will impact 51 Shawinigan employees. In addition to separation packages that include severance pay, Bandag will be providing outplacement assistance to all affected employees.
Bandag's common stock closed at $41.58 a share on the New York Stock Exchange on April 19. That compares to a 52-week high of $47.93 and low of $40.57. Bandag's Class A common stock closed at $34.85 a share versus a 52-week high of $42.59 and low of $34.
Bandag's Class B common stock is unlisted.
