Goodyear Tire & Rubber Co, the biggest tire manufacturer in the United States, recently announced it would move to close down its Wolverhampton, England facility and offset production to Europe, the Middle East and Africa (EMEA).
The decision has been made to lower production costs, with Goodyear also adding it would move consumer tire production from its factory in Wittlich, Germany to the EMEA region. The restructuring strategy means around 360-390 jobs could be lost, though the figures is still being discussed with employee representatives. According to the tire maker, the modifications would lift the EMEA region’s operating income by around $30 million annually starting with 2017. The region has 17 Goodyear manufacturing plants and is the company’s second-biggest market by revenue following North America. The company’s performance in the EMEA zone has been impacted recently by the currency swings and fierce competition from other companies, such as Michelin, Continental and Pirelli.
The company added the strategy would incur restructuring costs of around $70 million-$80 million, with around $30 million accounted during the current quarter. The company also shut down its factory in Amiens, France and ended output of farm tires in the EMEA region last year. Goodyear added its schedule for the restructuring completion is the end of 2016 and so far around $95 million in charges were booked in relation to severance and closures last year alone.