FAYETTEVILLE, N.C. (AP) -- The North Carolina city where Goodyear Tire & Rubber Co. operates a large plant has approved a $1 million payment to help retain jobs.
Fayetteville City Council will provide the funding over the next 10 years to upgrade the plant, retain jobs and improve the quality of production, The Fayetteville Observer reported Tuesday.
The funding is part of a $37 million incentives package provided to the company by Cumberland County and the state. In return, the company must spend at least $200 million to modernize the 40-year-old plant.
The county has promised more than $7 million and the state has offered $30 million after Goodyear closed two North American plants in 2006 and sent jobs overseas.
Five times last year, the Fayetteville plant stopped production to reduce inventory of premium tires.
City officials discussed at Monday's meeting how improvements in plant automation would affect employees. Plant manager Tim Frosell said some 500 employees were expected to retire soon and he is working on a plan to replace them.
"I don't have a crystal ball to answer that question, and so much of what happens is beyond our control," Frosell said.
The company's local payroll is more than $150 million and the plant is responsible for 3,992 spinoff jobs in the area, said Doug Peters, president of the Fayetteville-Cumberland County Chamber of Commerce.
Under the agreement, the city will stop making $100,000 annual payments if employment drops below 2,000 jobs at the plant.
The agreement also requires the company to complete the $200 million upgrade by the end of 2012 before any payments are made.
Frosell said Goodyear has made more than half of the investment already. The company and state began discussing incentives in 2007 when the plant employed about 2,500 workers. The plant now employs 3,000 people, who earn an average $50,000 a year.
"I feel strongly we are going to have a very bright future," Frosell said.