CLEVELAND (AP) -- Goodyear Tire & Rubber Co. said Tuesday that a new national contract with the United Steelworkers union will save the company $215 million over the four-year life of the agreement.
Combined with earlier staff-reduction agreements at five plants, the Akron, Ohio-based tire maker expects $555 million in savings by 2013.
Goodyear agreed to invest $600 million over four years to upgrade plants represented by the Steelworkers.
The agreement ratified in mid-September covers about 10,300 workers at plants in Akron; Gadsden, Ala.; Buffalo, N.Y.; Topeka, Kan.; Danville, Va.; Fayetteville, N.C., and Union City, Tenn.
Richard J. Kramer, Goodyear chief operating officer and president, North American Tire, said the agreement would allow the company to improve efficiency and flexibility in a quick-changing marketplace.
"This innovative agreement can truly change the way we run these factories," he said. "It's an agreement that gets us excited about our future competitiveness."
The agreement gives the company flexibility on vacation scheduling and staffing levels and trims $55 million in wage and benefit costs, according to Kramer.
For example, an employee who voluntarily moves to a lower-paying job cannot keep getting paid at the higher rate.
Of the plants covered by the agreement, only Union City was left unprotected from a shutdown. Both sides agreed before the national negotiations to allow Goodyear to trim the Union City work force through buyouts. The plant moved from a nonstop operation to five-day production.
Goodyear officials said in a conference call on the national agreement that there was no update on the Union City plant status.
Goodyear has nearly 70,000 employees and production facilities in 25 countries.
Goodyear shares rose 58 cents, or 3.5 percent, to $17.11 in Tuesday late afternoon trading.
