Agreement safeguards more than 900 jobs at tyre plant

Workers at a Bridgestone Tyres production plant in southern Italy have had their jobs safeguarded six months after a plan was announced to close the factory. On 30 September 2013, Bridgestone Europe signed an agreement for a €31 million investment programme at the plant with unions and the Italian government. Production will shift to general-use tyres, enabling the plant to compete with low-cost imports. It is thought that more than 900 jobs have been saved.

Background

In March 2013, Bridgestone Europe announced the closure of its car tyres plant in the southern Italian town of Modugno near Bari, in a region already suffering from high unemployment. The plant is owned by Bridgestone Italia. The company said it was struggling to compete with low-cost imports because of high logistics and energy costs. The shutdown threatened the loss of 950 blue-collar jobs.

Rescue options

In response to union requests, a working group was set up at the Ministry of Economic Development to look at the impact of the decision on employment and production in the region. The working group came up with two proposals:

• keeping the Bari plant within Bridgestone, known as the ‘internal option’;

• identifying potential investors to take over the plant and continue production, described as the ‘external option’.

A protocol, New productive and employment outlooks at the Bridgestone plant in Modugno, was signed in June 2013. Under the protocol, the parties involved agreed to support the ‘internal option’.

To discuss it, a number of meetings took place between the company’s management, national and territorial union representatives, and the unitary workplace union structures, known as Rappresentanza Sindacale Unitaria (RSU) during the summer of 2013. Progress was made while the Ministry of Economic Development oversaw the implementation of the protocol.

Agreement

On 30 September 2013, an agreement (in Italian, 2.47 MB PDF) setting out a restructuring plan for the Bridgestone plant in Modugno was signed. Signatories to the document were representatives of the Ministry of Economic Development, the Ministry of Employment and Welfare, the national agency for investment and business development Invitalia, Puglia’s regional administration, the Province and the Municipality of Bari, Bridgestone Italia, and the trade unions Femca-Cisl, Filctem-Cgil, Uiltec-Uil, Ugl-Chimici, Failc Confail and the RSU.

The company confirmed its commitment to redeveloping the plant and continuing production there. The external option was rejected, leaving the Modugno plant as part of Bridgestone.

Impact of the redevelopment

The two-year restructuring plan will begin in 2014, and take two years to complete. Bridgestone has pledged to invest €31 million in the redevelopment of the site, aiming for annual production of 3.5 million general use (GU) tyres and a significant reduction in operating costs.

Focusing on low value-added and non-specialised tyres, Bridgestone believes, will save jobs and make the plant viable. The company says it will improve the plant’s economic and financial results.

Site improvements set out in the agreement include:

  • renovation of the plant’s equipment;
  • flexibilisation of production;
  • investment in new production equipment for GU tyres;
  • the introduction of a training plan for workers’ continuous vocational training and requalification, to be funded by the regional authorities in Puglia.

The protocol also includes the commitment by public authorities to support the implementation of the agreement, which will involve the Ministry of Economic Development, Invitalia and the Puglia regional administration, and the Province and the Municipality of Bari.

Jobs will be lost, but voluntary redundancy packages will be offered for 377 workers and the company intends to make use of the social shock absorber of the special Wages Guarantee Fund for two years. Shift patterns will change and, from January 2014, production will move from a continuous cycle to five working days with four six-hour shifts per day.

Social partner reaction

Rosa Cassatella, a National Secretary for Filctem-Cgil, said she was ‘satisfied, despite the great sacrifices that had to be made by the workers’, and she hoped the deal would solve the crisis.

The Secretary General of Femca-Cisl, Angelo Colombini, expressed his ‘great satisfaction’ with the agreement. He said:

It shows that the Italian production system, the unions, the company and the local and central public authorities, through a long joint work that lasted for months, have been able to find solutions to reduce labour and energy costs, and to introduce continuous training opportunities for workers.

Paolo Pirani, General Secretary of Uiltec-Uil, said it was very satisfying to see a multinational company’s management change its mind, thereby safeguarding hundreds of jobs. He said: ‘There is still a lot to do, but more than 900 workers can now hope for their future.’

Franco Annunziato, the Chief Executive Officer of Bridgestone Europe, said the group wanted to thank the Bari plant workers. He said they:

…always showed a constructive attitude, which has positively determined the outcome of the negotiation. All the stakeholders involved in the conversion plan acted with great responsibility. The agreement is the consequential result of the joint efforts made during a six-month-long dialogue.

The Minister of Economic Development, Flavio Zanonato, stated:

…this agreement shows two things. First, it is possible to implement effective industrial policies in Italy which bring production back from Asia. Second, it shows that positive commitment and collaboration between public authorities, management and unions are key to achieve outcomes which would have otherwise been impossible.

Lisa Rustico, Università degli Studi di Milano

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Add new comment