AKRON—Goodyear has had its share of bad news lately: net income losses, planned layoffs, capacity cuts and a plant closure. And now, some good news.
The Fayetteville, N.C., city council approved a $1 million economic development incentive package in mid-February to help cover a modernization project at Goodyear's tire plant in the city.
The deal is contingent on Goodyear completing at least $200 million in capital investments at the facility by the end of 2012 and keeping the plant's work force in the 2,000 range, according to a company spokeswoman.
She said the tire maker fully intended to spend the planned $200 million figure, which is needed to modernize the 40-year-old factory. In fact, a majority of the funding already has been invested in the project, she said.
Goodyear began upgrading the facility in 2006 when it installed new machinery.
Under the city council plan, Fayetteville would award the company $100,000 annually for 10 years as long as all conditions are met.
It's the last piece of the puzzle in a modernization project that began three years ago when the tire maker started talking about the prospect with state officials, the spokeswoman said.
The state plans to provide Goodyear with up to $30 million over a 10-year period with the same stipulations the city is applying regarding capital investments and employee levels at the facility.
The state's portion was made possible in 2007 when the North Carolina legislature passed a bill creating an incentive program for existing companies if they make certain investments and keep work forces at predetermined levels, the spokeswoman said. “We applied and we were approved.”
Cumberland County, where Fayetteville is located, also has pledged incentives based on taxes paid on new equipment, which is a variable amount depending on the level of investment made each year, the company said.
Goodyear makes passenger and light-truck tires at the facility.