Posted: Oct. 3, 2006, 9 a.m., EST
From Akron Beacon Journal
AKRON, OH — Come Thursday afternoon, will there be a strike? A lockout? Or will the United Steelworkers of America and Goodyear Tire and Rubber Co. keep negotiating on a new labor contract?
The union, which represents about 13,000 hourly Goodyear employees, says that because it sees no progress in the talks taking place in Cincinnati, it will end a day-to-day contract extension as of 1 p.m. Thursday.
Meanwhile, the Akron, Ohio, tire maker and the union say they will continue talking.
Sticking points include Goodyear wanting the ability to close what it calls costly, less productive U.S. plants, while the USW has been insisting that union plants remain open and that the company protect pensions and retiree health care.
Strike signs were already stacked up Monday afternoon in USW Local 2’s offices in Akron. Downstairs, dozens of union retirees and others gathered in the meeting hall for their regular bingo games. Much of the talk revolved around fears that Goodyear will cut their health benefits.
About 470 Steelworkers make racing tires in Akron, with the rest of the union membership at 11 other Goodyear plants in the United States. The Akron area remains home to thousands of retirees from the city’s legacy tire plants.
"I don’t think either one of you can win if we go out on strike," said Carl Nelson, 78, who built tires for 43 years for Goodyear. He remembers striking in the 1970s as part of the United Rubber Workers, before the union merged with the Steelworkers.
"It will hurt them; it will hurt us," the Akron resident said. "I wish they would settle up and not hurt us too much…. You just hope it’s over with right away."
But the strikes did help the union win better wages and benefits, Nelson said. The previous three-year contract between the USW and Goodyear expired on July 22, with both sides agreeing to a day-to-day extension. Each side could end the extension by giving 72-hour notice.
"We’re prepared to keep bargaining," Steelworkers spokesman Wayne Ranick said. The union should have a better understanding today of what action it will take on Thursday, he said.
"We’re prepared for a number of scenarios. Striking is one of them," Ranick said.
The Steelworkers in August ratified a three-year contract with Michelin and its BFGoodrich and Uniroyal subsidiaries that was to be a pattern for talks with Goodyear and Bridgestone Firestone.
David Prentice, spokesman for Local 2, said union workers may begin assembling picket signs today at the Akron hall. "We’re 90 percent (prepared) already," he said.
A strike could cost Goodyear as much as $2 million a day, according to a Sept. 22 report by Saul Ludwig, industry analyst with KeyBanc Capital Markets in Cleveland, Ohio. Standard & Poor’s on Monday said the union’s termination of the day-to-day extension "could be a prelude to a strike."
"On the other hand, it may signal that a resolution to ongoing contract negotiations may be forthcoming in the near term … While a strike would be costly to Goodyear, the firm has sufficient liquidity and financial flexibility to withstand a short-term labor disruption," Standard & Poor’s said.
The report said S&P expected Goodyear to make progress in "reducing its bloated U.S. cost structure" under a new contract.
"We’ve been telling the company that we would stay at the bargaining table as long as progress was being made," USW executive vice president Ron Hoover said. "There’s no sense continuing these talks if Goodyear is intent on gutting our contract and closing our plants."
The 72-hour notice "simply creates a new deadline, which helps bring focus to the discussions as we work toward a new agreement," said Jim Allen, Goodyear’s chief negotiator. "While we are working hard toward successful resolution, in the event that does not occur, Goodyear has contingency plans in place to continue operating our factories and serving our customers."
Goodyear shares closed down 12 cents to $14.38.
Meanwhile, at the Local 2 union hall, the retirees wondered whether they will be able to afford medical coverage under a new contract.
Jerry Smith, 65, retired from Goodyear’s technical center in 2003. "I don’t know why they’re attacking us retirees," he said. "They promised they’d take care of us. They’re reneging." Smith said he thinks Goodyear wants a strike so it can eventually cut retiree pensions and health costs. He worked 25 years for Goodyear and remembers going on strike in 1997.
"It’s a no-win situation," he said. "Neither the company nor labor wins. You both do without."
Copyright (c) 2006, The Akron Beacon Journal, Ohio
