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Goodyear Anticipates $100-$150 Million Savings

3 February 1999

Goodyear Anticipates $100-$150 Million Savings from Manufacturing Rationalization

    AKRON, Ohio, Feb. 3 -- In a major global rationalization
effort involving three continents, Goodyear has announced significant changes
in its manufacturing operations, leading to estimated annualized benefits of
$100-$150 million.
    The move is in response to the recent developments in Latin American
economies, the on-going Asian crisis and inefficient operations in North
America.
    The Gadsden plant in Alabama -- one of the five largest Goodyear plants on
a worldwide basis -- will cease tire manufacturing by the end of 1999.  The
plant will continue to mix rubber for other manufacturing plants -- the number
of associates needed for this purpose has not been decided.
    Gadsden opened in 1929 and is one of Goodyear's oldest and most
inefficient plants.
    "We have not taken this decision lightly and understand the unfortunate
impact this decision has on our associates, their families and the community,"
said John Orr, vice president, North American Tire manufacturing.  "Decisions
of this nature are the reality of the competitive environment in which
Goodyear is operating."
    Production from Gadsden will be transferred to other U.S. plants which now
operate seven-days a week at full capacity.
    In Asia and Latin America, where the effects of the economic crisis
continue to dampen original equipment and replacement tire demand,
rationalization measures will be taken in several plants.
    As a result of the rationalization in Gadsden, Asia and Latin America, and
also because of other similar initiatives, it is anticipated that a total of
2,500 to 2,800 people will be laid off.
    Goodyear Chairman Sam Gibara said:  "As a company, we have a duty to our
customers, shareholders and associates to utilize our assets, especially our
manufacturing facilities, on a global basis.  We will continue to invest in
plants which demonstrate that they can provide the maximum productivity and
highest efficiency levels."
    Estimated one-time costs for the Gadsden, Latin America and Asian programs
are in a range between $100 to $150 million.