Goodyear Tire & Rubber said Monday that it plans to close its plant in Tyler, Texas, eliminating 1,100 jobs.
The move is part of the Akron, Ohio-based tire company's plan to shutter some of its private label businesses, the company said.
Goodyear (NYSE: GT) said the move would save about $50 million a year after taxes. The company expects to take a restructuring charge of between $155 million-$165 million related to the plant closing, with the cash portion of these charges ranging between $40 million-$50 million.
"We must take the steps necessary to reduce our costs and improve our competitive position," Jon Rich, president of Goodyear's North American Tire division, said in a statement. "While this is an extremely difficult decision for everyone involved, it was required to help turn around our North American business."
Rich did not say when the company would close, but said the closing would be timed to minimize the impact on Goodyear customers.
Goodyear previously announced a strategy to reduce costs by more than $1 billion by 2008, including reducing high-cost tire manufacturing capacity.
The Tyler plant, which opened in 1962, primarily makes small passenger-car tires, a business that has been under considerable pressure from low-cost imports, Goodyear said. The plant makes about 25,000 passenger-car and light truck tires a day.
Goodyear also makes passenger and light truck tires in Union City, Tenn., and employs 2,300 people in the greater Memphis area. The company operates a 600,000-square-foot distribution warehouse in Memphis, where it employs 73.
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