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Bridgestone/Firestone Announces Additional Production Adjustment Plan

20 November 2000

Bridgestone/Firestone Announces Additional Production Adjustment Plan; Recall Replacement 80 Percent Complete

        - Additional Production Cutbacks Will Occur in Three US Plants
  - Company Has Replaced Over Five Million Tires Under Safety Recall Program

    NASHVILLE, Tenn., Nov. 17 Bridgestone/Firestone, Inc.
(BFS) today announced that effective January 21, 2001 it will reduce tire
production at its LaVergne, Tenn. and Oklahoma City, Okla., plants.  These
actions are in response to the continuing oversupply of passenger radial
(PSR), light truck radial (LTR) tires and truck and bus radial (TBR) tires.
In addition, it will temporarily curtail production for two weeks at its
Warren County, Tenn., plant in response to an oversupply of replacement and
original equipment TBR tires.
    Today's announcement will result in the temporary layoff of approximately
700 people in Oklahoma City and nearly 400 workers in LaVergne.  The temporary
production curtailment at Warren County will result in a plant shut down
during the weeks of January 14 and 21 and will affect approximately 900
employees.  No layoffs are associated with this production curtailment.
    For employees affected by these actions, the company will provide benefits
consistent with the company's policies and collective bargaining agreements
with the United Steelworkers of America (USWA).  Generally this means that
affected employees will receive up to 80 percent of their usual wages during
the temporary downtime.
    "It is our hope and expectation to be able to bring back these employees
during the second half of next year as we anticipate an increase in sales and
we deplete our inventories," said John T. Lampe, chairman, chief executive
officer and president of Bridgestone/Firestone, Inc. "We are in a situation
where sales of replacement tires have declined for several reasons. Obviously
concerns surrounding the recall of certain Firestone tires is a contributor to
this decline in the PSR and LTR segments. However, the entire industry is
experiencing a slowdown in sales of both TBR original equipment and
replacement sales."
    In addition to decreases in TBR, LTR and PSR sales, Bridgestone/Firestone
still has a large inventory of tires that was built up in expectation of a
strike earlier this year.  The strike was averted when the company
successfully negotiated new contracts with the USWA, which was ratified on
September 21.
    "We had a very strong first half of the year for tire sales and in
anticipation of a strike we built up our inventory to a level to meet
projected sales that have not materialized," said Lampe.
    These cutbacks are in addition to the reductions the company announced
last month, which curtailed production at the LaVergne and Oklahoma City
plants for two two-week periods during the fourth quarter of this year and
curtailed production for one two-week period at its Decatur, Ill., plant.  The
company also announced that it would lay off approximately 450 people at the
Decatur facility for an indefinite period.
    "Some people may ask why we did not take more drastic steps last month,"
said Lampe.  "As we recently began our budget development and sales forecast
processes for 2001 it became apparent our earlier production adjustments were
not adequate and a more aggressive plan was needed.  We will continue to
monitor and evaluate our business and will react accordingly."
    The company said today's announcement will have no impact on the recall
replacement program.
    Commenting on the recall replacement efforts, Lampe said, "We have
replaced about 80 percent of the recalled tires, which represents over five
million tires.  By the end of November we expect all waiting lists will have
been eliminated.  We urge anyone who has not yet had their recalled tires
replaced to visit their local Firestone retailer.  The supply of replacement
tires is more than adequate to respond to customer needs.  Completion of the
recall and determination of the root cause of certain tire failure remains the
company's top priority.
    "I am extremely pleased with the significant progress we have made in this
unprecedented tire replacement effort," he added.  "A rapid completion of the
recall effort and understanding why some tires failed were my foremost goals
in beginning to restore consumer confidence and revitalize the Firestone
brand."
    The company has not yet reached a final conclusion in determining the root
cause or causes of the tires that failed, but its special project team and,
separately Dr. Sanjay Govindjee, an independent expert hired by the company,
are working diligently to finish their analyses.
    "I said last month that we would take the necessary steps to rebuild this
organization and revitalize the Firestone brand.  While no one ever likes to
announce layoffs and production reductions, it is necessary to do so in order
to ensure the financial strength and viability of this company," concluded
Lampe.