Bridgestone to close Australian, NZ tyre plants

BRIDGESTONE Australia announced last week that it would close its tyre factories in South Australia and New Zealand with the loss of 875 jobs.

The Australian subsidiary of the Japanese tyre giant said last Friday that about 600 jobs would be lost at its plant in Adelaide, and a further 275 in Christchurch, due to “international competitive forces” that have made its operations in both countries “no longer viable”.

This is despite the fact that it managed a $7.85 million profit – and reported a rise in sales revenue – last financial year (ending December 31, 2008).

The New Zealand factory will be closed by the end of December, with the Australian manufacturing operations wound up no later than April 30, 2010.

At this stage, Bridgestone’s distribution, customer service and retail networks in both countries, which employ more than 1500 workers, will “continue unaffected”.

“We would like to express our thanks to all our employees at our manufacturing facilities in both countries. Their contribution over so many years is to be admired and celebrated,” said Bridgestone Australia senior executive director Andrew Moffatt.



“It is our goal to help as many of our employees as possible gain alternative employment, either within the Bridgestone organisation or in the wider marketplace.”

The Australian federal and South Australian governments have promised to assist the Australian workers find new jobs, although federal industry minister Kim Carr expressed surprise at the snap decision.

“There’s no doubt that companies have to evaluate their options,” Senator Carr told ABC news. “These decisions take time and it is apparent to me, given the experience of so many other companies, this was not a matter that was first considered on Friday.

“We will discuss with the South Australian government and Bridgestone what actions can be taken to provide alternative employment for people who are displaced by the decision of Bridgestone, the commercial decision of Bridgestone, to close its plant.

“We need time to actually assess the options.”

Mr Moffatt said the company had “worked hard over many years” to avoid the factory closures. The Adelaide plant has operated since 1965, and Christchurch since 1947, and together account for about one per cent of Bridgestone’s global tyre production.

“We would also like to put on record our thanks to the various levels of government in both Australia and New Zealand,” Mr Moffatt said.

“As the last tyre manufacturer in Australia and New Zealand, we have all worked hard over many years to avoid today’s decision. However, the unfortunate reality is that Bridgestone Australia Ltd. can no longer commercially justify the continued operation of these facilities.

“We are proud of the fact that we have managed to keep these two manufacturing facilities open for so long and have provided employment and economic benefits to so many people over such a long period.”

Bridgestone intends to announce its third quarter financial results on November 5.

In August, the company issued a revised forecast for its fiscal year ending December 31, 2009, with an anticipated operating income of ¥61 billion ($A719.2m) and net income of ¥6 billion ($A70.7m).

This is well down on its FY2008 results, in which it returned an operation income of ¥131.5 billion ($A1.5b) and net profit of ¥10.4 billion ($A122.7m).