News From USW: USW Blasts Goodyear's Plan to Sell $1 Billion Notes

PITTSBURGH--News From USW: The United Steelworkers (USW) blasted today's announcement by Goodyear Tire and Rubber to place about $1 billion of three-year and five-year senior unsecured notes, subject to market and other customary conditions. The company has indicated that it will use about one-half of the proceeds to repay existing notes due December 1. 2006 and March 1, 2007. The rest of the money will be used for general purposes, including funding its ill-conceived strike with the USW.

"Goodyear is already carrying about $6.4 billion dollars in debt, and its credit is poor and getting worse," said USW International president Leo W. Gerard. "Now they plan to borrow more money to flush down a rat hole of a fight they can never win."

"Quite simply, this latest move by the company is the wrong thing for the wrong reasons at the wrong time," said USW International vice president Tom Conway. Conway heads the USW's bargaining team in its negotiations with Goodyear. "When you borrow money, you have to pay it back, and to pay it back Goodyear needs to build tires that people want to buy," said Conway. "This company has no such plan in place."

"It is really time for the company's owners to step forward and stop this madness," said Gerard. "Bob Keegan is looking increasingly like Captain Queeg in the The Caine Mutiny."

Queeg is the fictional character in Herman Wouk's 1951 novel, who was removed from command of a World War II minesweeper because of eccentric behavior that lead to mistakes that endangered his crew.

The USW represents more than 17,000 workers at Goodyear facilities in the U.S. and Canada. On October 5, about 15,000 USW-represented workers at 16 locations in North America went out on strike in an effort to win a fair and equitable contract.

Overall, the USW presents more than 850,000 members in the U.S. and Canada. Some 70,000 are employed in the tire, rubber and plastics industry.