CHARLOTTE, N.C. (Jan. 9)—Continental Tire North America Inc. will lay off 513 hourly and salaried employees at its Charlotte plant in a two-phase cutback that will ultimately reduce daily production by 12,000 units, the tire maker said.
The first phase, affecting 241 employees, will occur on March 15, with the second phase following on June 30, affecting 272 employees. Afterward, the plant will operate with a total of 573 employees, the company said. In the first phase, production will be down 6,000 tires to 18,000 units. The second phase will draw back another 6,000 units to about 12,000 tires. A company spokesman said the cutbacks apply across the board, to passenger and light truck tires.
"Manufacturing costs in our Charlotte facility are higher than any other Continental tire plant worldwide," said Alan Hippe, president and CEO of CTNA. "Our overall objective is to reduce significant financial losses while expanding our market position in the North American marketplace for all tire operations."
In June, Conti scaled back production at the Charlotte plant by about 30 percent, citing high inventories and high manufacturing costs.
Conti also is currently in contract talks with the United Steelworkers. The tire maker wants to cut $32 million in costs from the plant.
"We want to continue to manufacture tires in Charlotte, but global competition is putting pressure on us as our manufacturing costs are cheaper overseas," Hippe said in a statement. "Our future here and all over North America depends on our ability to increase efficiencies and reduce labor costs in our manufacturing operations."