Cooper Down Grade Inner Tube Production
Due to a decline in demand Cooper Tire & Rubber has decided to end production of inner tubes at its Clarksdale, Mississippi, plant by 12 November.
The company has confirmed that most of the facility’s 159 workers will be made redundant. About 30 of the workers are expected to remain at the plant to produce curing bladders and operate the rubber mixing unit, which produces rubber for internal consumption at the company’s other plants.
In an official statement the company explained that employees have been notified of the redundancy and will receive outplacement assistance. Cooper is also said to have notified its customers about the inner tube decision and is provided recommendations for alternative sources.
The phase-out is expected to cost about $9 million (£5 million), which will be needed to cover the write-down of assets and the impacts of severance and other benefits. The company will record a charge of approximately $7 million during the third quarter of 2004 as a result of this decision.
Cooper maintains that the decision supports its strategy to “dedicate resources to those product categories that will help the business grow globally and provide shareholder value.” cma