Kitchener, ON — BFGoodrich Tire Manufacturing, a business of Michelin North America (Canada) Inc., will close its facility in Kitchener, Ont., by July 22, 2006. The company will shift production to other BFGoodrich Tire Manufacturing facilities in North America.
The decision is a result of overcapacity in BFGoodrich’s mass market passenger tire segment in North America. This segment has been contracting over the past several years and is also experiencing intense cost pressure due to imports from competitors in lower-cost countries. The Kitchener plant produces BFGoodrich, Uniroyal and private and associate brand mass market passenger tires, primarily for the U.S. market.
“The decision to close the Kitchener plant was very difficult,” said Guy Pekle, president of Michelin North America (Canada) Inc. “BFGoodrich has made significant investment in the plant, as well as its three other North American plants; however, overcapacity continues to exist in this segment of the market. The competitive nature of today’s tire industry requires the company to invest and maintain production in the plants that can compete successfully in an increasingly difficult global market.”
Customers will be supplied by the three U.S. BFGoodrich Tire Manufacturing plants in Tuscaloosa and Opelika, Ala., and Fort Wayne, Ind. The decision ensures the company will be better able to fully utilize the capacity of these three facilities, which will continue to focus on improving their competitiveness.
The Kitchener plant closure will not affect Michelin’s other Canadian facilities.
The company will work with the appropriate government agencies, the community and the United Steelworkers to help to make the transition for all affected employees as smooth as possible, including providing separation pay and other benefits.
Recognizing that the BFGoodrich Kitchener facility is a significant part of the local economy, Michelin North America (Canada) Inc., is also establishing a Michelin Development Program to assist in the creation of new jobs from diverse industries within the community. Details of this initiative will be communicated in the coming weeks.
The Kitchener plant employs approximately 1,100 wage and salaried employees.