United Steelworkers Ratify Michelin U.S. Tire Contract

CHICAGO, Aug 6, 2006; Reuters reported that United Steelworkers members ratified a three-year contract covering about 3,450 workers at three of Michelin's BFGoodrich tire manufacturing plants in the United States, the union and company said late Saturday.

The two sides reached a tentative agreement in late July for its plants in Alabama and Indiana and members voted on the agreement over the past several days, approving it at each facility, the steelworkers said,

The steelworkers plan to use the contract as a template for talks with Goodyear Tire & Rubber Co. and Bridgestone Corp., whose U.S. contracts expired on July 22 along with the contract that covered the BFGoodrich plants.

Michelin said the agreement reduces its wage rate structure by 20 percent -- in part by cutting hourly pay for starting workers -- and increases employee health care contributions to give the company flexibility in North America.

Tire makers face intense pressure in North America from low-priced import tires and escalating prices for natural rubber, petroleum-based synthetic materials and steel.

Michelin has agreed not to close any BFGoodrich tire plants or make significant job cuts during the contract other than those already announced and negotiated. Michelin also agreed to invest $100 million in the three plants through 2009.

In July, Michelin announced plans to lay off up to 40 percent of its workers at its Opelika, Alabama, tire plant to cut excess capacity.