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Archive for Friday, October 6, 2006

Goodyear steelworkers go on strike

October 6, 2006

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— Steelworkers union members walked off the job Thursday at 16 Goodyear Tire and Rubber Co. plants in the United States and Canada, unable to reach an agreement on a new contract despite months of talks with the world's third biggest tire maker.

Goodyear said the union refused to agree to help it remain competitive in a global economy. The union said the company's latest proposal would have included two plant closings and other concessions.

"Closing more plants would not only cause additional job losses and devastate the communities where the operations would cease, but it would also threaten the long-term viability of Goodyear," said Ron Hoover, executive vice president of the United Steelworkers of America, which represents the Goodyear workers.

Saul Ludwig, a KeyBanc Capital Markets analyst, said a strike could cost Goodyear $2 million a day. The company could save $50 million a year by closing a U.S. plant, he said in a report to clients.

He said in an e-mail to The Associated Press that unless the strike was lengthy, consumers should not see tire prices affected by the walkout because of the large inventory of tires in the market.

The company will continue production at two nonunion plants in Lawton, Okla., and Napanee, Ontario, and will use salaried workers at its union plants, company spokesman Ed Markey said.

Markey declined to comment on whether the company's offer involved plant closings. The 108-year-old company had 2005 sales of $19.5 billion and more than 100 plants in 29 countries.

A 77-year-old plant in Gadsen, Ala., and one in Tyler, Texas, weren't on the company's list of "protected" factories, meaning they could be closed.

Without giving details, Goodyear said it believes its final offer protected jobs and secured pensions. The union failed to agree to terms found in Steelworkers contracts with other tire makers that the company believes are necessary to survive in the global economy, the company said.

"We simply cannot accept a contract that knowingly creates a competitive disadvantage versus our foreign-owned competition and increases our cost disadvantage versus imports," said Jim Allen, Goodyear's chief negotiator.

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