Goodyear Tire to Cut 500 Salaried Jobs

AKRON, Ohio, August 28, 2003; The AP is reporting that Goodyear Tire & Rubber Co. said on Thursday that it will eliminate about 500 salaried and nonunion jobs at its North American tire operations.

The reductions at the nation's biggest tire maker will involve management and staff positions at most of its manufacturing plants throughout North America in a bid to cut costs.

Each location is developing its own plan for how the reductions will be achieved by the end of September.

"When we announced our turnaround plan at the end of last year, we said that difficult decisions would be required," said Jon Rich, president of Goodyear's North American Tire business unit. "This is one of those very difficult actions, but it is absolutely necessary to achieve our cost reduction objectives."

Earlier this year, Goodyear eliminated approximately 700 salaried positions, the majority of which were at its Akron headquarters.

Goodyear has been struggling financially, and its turnaround plan includes reducing costs by $1 billion to $1.5 billion by the end of 2005.

It lost $236.9 million, or $1.35 a share, in the first half of the year.

Martin King, a Goodyear analyst for New York-based Standard & Poor's, said Thursday that the timing of the job cuts announcement "very well could be designed to demonstrate that the effort to turn around the company will not be just directed at the union members, but at the corporate level as well. They already had an idea of the things they needed to do for some time."

Goodyear reached a tentative contract agreement Aug. 20 with the United Steelworkers of America. The three-year deal, expected to be a tire industry pattern, will be voted on by union members in September.

The company makes tires, engineered rubber products and chemicals at more than 90 plants in 28 countries. As of the end of the second quarter, it employed about 92,000 people.