Goodyear, USW Begin Negotiations Over New Contract

Almost three years have passed since the agreement between Goodyear and the United Steelworkers of America on a new master contract ended several months of strike action, and on July 18 the contract is set to expire. Negotiations between the two parties on a new contract began on June 8 – but whether or not mutually agreeable terms can be reached without revisiting the events of 2006 remains to be seen.

The existing three-year contract covers some 10,300 workers as seven Goodyear factories in the US, and while the USW states its goal in negotiations will be to improve pay and benefits, it acknowledges that job security will overshadow other issues. Priority for Goodyear, on the other hand, is controlling costs. “Goodyear’s goal for its North American Tire manufacturing operations is to be competitive within North America and with the rest of the world,” the company said in a statement. It singled out improving productivity and flexibility while dealing with rising health-care and pension costs as a focus.

Goodyear chairman and CEO Bob Keegan has already discussed the company’s plans to cut 5,000 jobs globally in 2009, including the 3,800 cuts made through to March. Goodyear froze its US salaried pension plans on December 31; according to the company’s website, Goodyear “has experienced periods of declines in interest rates and pension asset values,” which has left its pension plans “significantly under funded.”