KITCHENER, Ontario (Feb. 2) — Michelin North America Inc. will close its BFGoodrich passenger and light truck tire plant in Kitchener, Ontario, effective July 22, due to overcapacity in a shrinking North American mass market passenger tire segment in North America.
Michelin will shift production to its other North American BFGoodrich tire units — in Opelika and Tuscaloosa, Ala., and Fort Wayne, Ind. —the company announced today. The Kitchener site houses about 1,100 salaried and hourly employees.
Michelin said the mass market passenger tire segment in North America has been decreasing in size over the past several years, plus it is experiencing "intense cost pressure" caused by increased imports from lower-cost competition abroad. The 34-year-old Kitchener plant, with an estimated daily capacity of about 17,000 tires, produces BFGoodrich-, Uniroyal- and private- and associate-brand passenger tires, primarily for the U.S. market.
"The decision to close the Kitchener plant was very difficult," said Guy Pekle, president of Michelin North America (Canada) Inc. "BFGoodrich has made significant investment in the plant, as well as its three other North American plants. However, overcapacity continues to exist in this segment of the market."
Michelin and the United Steelworkers union, which represents about 1,000 hourly workers in Kitchener, reached a contract agreement following a short strike in August 2004. Language in the pact included no-plant-closure security, but the deal lapses July 22, the designated shutdown date.
The shutdown will not affect Michelin´s other Canadian facilities, all located in Nova Scotia.