Goodyear cancels plans for Brazilian tire plant

SAO PAULO, Brazil (July 30)—Goodyear's Brazilian subsidiary has notified local authorities in the state of Rio Grande do Sul it has cancelled plans to build a tire plant there. Goodyear originally announced plans in 1998 for a $180 million facility to be completed by year-end 1999 in Glorinha, near the site Ford Motor Co. was developing as its Blue Macaw assembly plant. By mid-1999, the slumping Brazilian economy prompted Goodyear to postpone the project indefinitely. "Considering the current economic situation and the slowdown in the tire market, Goodyear do Brasil has reached the conclusion that there is no need to build a new factory," the company said in a statement. The new plant would have produced 1.2 million tires a year. The project, which was to have showcased the firm's Impact manufacturing technology, never went much beyond site clearing, a spokesman said. Goodyear operates two tire factories in Brazil with a combined daily output of 37,000 tires. The company added it would not "discard the possibility of building the plant in the future, when market conditions improve."