All right. Everyone who was surprised General Tire finally decided to move its corporate headquarters to Charlotte, N.C., raise your hand. No one? OK, hands up, all those who think it's merely coincidence the nearly year-long decision was announced on Election Day, the one day in the year when the story would get short shrift. Uh huh. A couple of takers.
Now, who believes this is the answer to General's woes? Let's see, there's one over there. There's another. Come on, people, you gotta believe.
I'll tell you one thing, I wholeheartedly believe the statement by Alan L. Ockene, General president and CEO, that General's ``basic strategy has been to cut our costs.'' I have no doubt that's the driving force at General. Has been for years-decades.
I vividly remember one-time Chairman and President M.G. O'Neil declaring that General would be the U.S.'s low-cost producer, period. Had to, to survive. At the time the company was trying to extract the necessary cost savings out of the hides of the United Rubber Workers, particularly at the Barrie, Ontario, and Waco, Texas, tire factories. Plants that now are closed.
Some analysts say General's move from Akron is an effort to break the corporate culture. If the corporate culture is centered on cost-cutting, then General's decision-makers are doing their job. The quickest way to reduce expenses is to dump employees, and another 300 Akron-based Generalites will miss the bus to Charlotte.
It's my guess the Powers that Be at Continental A.G., General's parent, are far from satisfied at the U.S. subsidiary's performance. General has strengths-its truck tire business, for example, stands out as a winner-but its passenger tire division is weak. The overall balance sheet is poor during a boom period for the tire industry.
Sounds like time for a shake-up.
The problem is, General has been shaking things up for a while, without reaping enough of a financial windfall. The company has purged senior management and cut 35 percent of its Akron staff since 1991. Still, the perception lingers that General has lacked focus. Decisions like the flip-flop on whether to build a tech center in Charlotte, and the on-again-off-again sponsorship of the PBA bowling tournament in Akron, contribute to that viewpoint.
Now General is either: a) trying to break with the past, or b) just trying to cut more staff.
The future will show whether General has been reborn in the Sunbelt, or if old Generals never die, they just move to Charlotte.