Analyst Saul Ludwig comments on plant closure

Feb. 11, 2011

“The only surprise was the ‘when,’ not the fact that they were going to do it,” says Saul Ludwig about Goodyear Tire & Rubber Co.’s plans to shutter its Union City, Tenn., tire plant (see “Closure of plant plays into Goodyear's 'selective strategies”).

Ludwig is the top tire industry analyst. He is a managing director with Northcoast Research Holdings LLC based in Cleveland, Ohio, and the author of the Ludwig Report in each issue of Modern Tire Dealer.

“The Union City plant was a non-protected plant, per the union contract,” Ludwig notes. According to MTD data, the plant, which was built in 1968, has the capacity to produce 35,000 passenger and 13,000 light truck tires per day.

“A Goodyear plant closing has long been expected’” Ludwig says. “The company has been telegraphing that they were going to close more units of high-cost capacity. The Union City plant is really the only plant which fits that description.”