FRANCHISE HERALD
Thursday February 20, 2020

updated - February 20, 2020 Thursday EST

Goodyear to Close UK Tire Factory to Manage Costs as Competition Rises

Jun 26, 2015 10:36 PM EDT | By Don Gil Carreon
Tags
Goodyear, job cuts, plant closure
Close
Goodyear will close its tire plant in England as part of its cost management efforts.
(Photo : Justin Sullivan | Getty Images News)

Goodyear Tire & Rubber said Thursday it would close its manufacturing plant in Wolverhampton, England, letting go of its 390 people there to cut costs.

The Wolverhampton plant produces commercial retreaded tires and compound mixing. These operations will be moved to Goodyear's other plants in Europe, the Middle East and Africa, Reuters reported. It added that the consumer tire production in Wittlich, Germany will be transferred to other plants as well.  The company expects  the restructuring to cost the company between $70 million to $80 million.

In a report on the BBC website, Goodyear said it understands the impact of the plant closure on the community and will ensure the affected employees are provided support. However, the company said the moves are needed for the sustainability of the business.

Goodyear added that dialogues and consultations with employee representatives will be held and it will honor its responsibilities to its people.

The BBC reported that the Wolverhampton plant, Goodyear's sole manufacturing facility in England, was opened in 1927 and had 7,000 employees during its peak. It added that local officials and residents were deeply disappointed by the plant's closure.

Goodyear, which employs 75,000 across the world, said the restructuring will help it increase competitiveness amid a challenging business environment.

The company said the operating income of its operations in those region, which is the second revenue generator for Goodyear after North America, will increase by $30 million annually beginning in 2017. The company operates 17 plants in those regions,  but increased competition and a stronger dollar have affected performance. Last year, the company also closed a plant in Amiens, France, which cost it $95 million for severance and other expenses.

Reuters noted that Goodyear's shares are up by 10 percent this year, compared to the 4.5 percent rise of the Dow Jones U.S. Autoparts Index.

Get the Most Popular Franchiseherald Stories in a Weekly Newsletter
© 2015 Franchise Herald. All rights reserved.

Connect With Franchise News

Email Newsletter

TOP 10 FRANCHISES OF 2020

  • RANK
    FRANCHISE NAME
    STARUP COSTS
  • 1nc
    Hampton Hotels
    $3.7M - 13.52M
  • 2nc
    Subway
    $85.2K - 260.35K
  • 3up
    Jiffy Lube Int'l. Inc.
    $196.5K - 304K
  • 4down
    7-Eleven Inc.
    $30.8K - 1.64M
  • 5up
    Supercuts
    $103.55K - 196.5K
  • 6up
    Anytime Fitness
    $56.3K - 353.9K
  • 7down
    Servpro
    $133.05K - 181.45K
  • 8down
    Denny's Inc.
    $1.18M - 2.4M
  • 9down
    McDonald's
    $1M - 2.16M
  • 10down
    Pizza Hut Inc.
    $295K - 2.15M
Real Time Analytics