Bridgestone Americas Tyre Operations (BATO) will stop passenger and light truck tyre manufacturing at its LaVergne, Tennessee, plant "due to negative economic conditions, which continue to create a difficult business environment" with the loss of 543 jobs. A further 259 jobs will go with the reduction of remaining truck tyre output.

"Based on current economic forecasts, it appears that the global economic crisis is going to get worse before it gets better. We are not immune from these challenging times," said Steve Brooks, president, US, Canada and Monterrey Manufacturing group at BATO.

The company signalled the plan early last month and held talks with the United Steelworkers (USW) on what, if any, actions could be taken to continue consumer tyre production at the factory. Following those meetings, the union told members it would take "massive cuts to wages and benefits" to bring passenger and light truck tyre production at the facility to a financial break-even point, BATO said.

Additional 294 hourly, 31 maintenance and 60 salaried workers will lose their jobs from mid-March. The end of consumer tyre manufacturing at the plant will result in a permanent reduction of 543 jobs, a tally which includes 148 hourly and 10 salaried workers laid off last month.

BATO said it would work with the union and local and state officials to help address the impact on the LaVergne workers. Salaried staff will receive severance benefits including out-placement assistance.

BATO also said it would also cut truck tyre production in order to reduce inventory to match demand and that will also result in layoffs of about 191 hourly, 34 maintenance and 34 salaried workers beginning in mid-March.

"We hope that the economy will begin to recover later this year; as a result we also hope that we will be in a position to begin calling [staff] back to work in the truck and bus tyre production area, perhaps as early as the fourth quarter of 2009," Brooks said.

"Our hope is that all truck and bus production [employees] can return to work by the end of the first quarter of 2010.

"The truck tyre market is often seen as a leading indicator of how the economy is doing. As consumer confidence begins to improve and consumer spending increases, more trucks - and truck tyres - will be needed to address consumer demand."

Hourly workers laid will be eligible for pay from the company under a collective bargaining agreement while salaried staff will receive severance benefits and out-placement assistance.

Truck tyre manufacturing will continue at LaVergne with 700 remaining staff.

"While these decisions were difficult, the actions are necessary in order to ensure the health of our entire Americas tyre business," Brooks added.