Workers Buy Euzkadi Plant Tax Free

Mexican workers have bought the Euzkadi factory that Continental Tire had planned to close. By investing the severance packages that they received when the closure was announced in December 2001 the union workers have acquired 50 per cent of the factory that will shortly be renamed Cooperativa de Trabajadores Democráticos de Occidente. The remaining 50 per cent was purchased by Llanti Systems, a former customer of the factory and its Pneustone brand. At the same time the Mexican government honoured an agreement stating that union members who invested in the joint enterprise will be exempt from income tax.

Euzkadi’s closure left 1,164 workers unemployed, after claims that the factory was financially impracticable.
The fist tyre manufactured by the new enterprise is expected to be roll of the production line by mid 2005. The new company will have a capacity of between 10,000 and 13,000 tyres per day, a level similar to that of Euzkadi plant prior to its closure.