Bridgestone Americas Addresses Decrease In Demand For Small And Medium Size Off Road Tires

NASHVILLE, Tenn. (Feb. 16, 2009) — Bridgestone Americas Tire Operations (BATO) today announced that it will lay off 67 hourly teammates from its Bloomington, Ill., facility, effective March 1.

With the unprecedented decline in construction — both residential and commercial — the demand for construction equipment, including tires, has evaporated. Due to the downturn in the economy, the slowdown in construction, and the resulting lower demand for small and medium size off road tires, production must be reduced in order to better align this inventory with demand.

“The dramatic downturn in the economy continues to plague every industry, including ours,” said Shawn Rasey, President, Off the Road Tire, U.S. & Canada, Commercial Tire Sales division, BATO. “Sales demand for off road tires began dropping in September 2008, the same time we began seeing a significant increase in inventory levels. We’ve made production reductions to accommodate the drop in sales — which have included eliminating discretionary overtime, reassigning teammates from parts of the plant hit by the economic slowdown to other areas of the plant, implementing a hiring freeze and cutting production days over the winter holiday — but unfortunately it hasn’t been enough.”

The decision was reached after serious consideration of all alternatives. Through natural attrition (e.g., retirements), the plant was able to avoid layoffs at the end of last year, even in the face of two major reductions in the plant’s scheduled production.

Additionally, a recent investment in new curing equipment at the plant that will allow increased production for the giant tire market — and the resultant 40 jobs it created at the plant — is allowing this layoff to affect fewer people than it would have without the investment. While still under tremendous pressure, the giant tire market has not yet experienced the same level of reduced demand as the small and medium size markets.

“While conscious of the current market volatility, we continue to take the longer view and invest in key segments to meet the demands of our customers,” Rasey said. “As the economy recovers, we fully expect the giant tire segment to become stronger and require the output from our capacity expansion.”

Teammates affected by the layoff who meet state criteria are eligible for unemployment benefits from the state of Illinois. Those currently enrolled in the company’s medical plan will have three months of coverage at the active rate and COBRA eligibility from that point forward.

As openings at the plant occur due to attrition, the company will fill those positions with teammates who are affected by the March 1 layoff. If the economy shows signs of recovery later this year, BATO hopes to be in a position to begin calling teammates back to work, perhaps as early as the 4th quarter, 2009, and hopes all teammates can return to work by the end of the 1st quarter, 2010.