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Goodyear’s potential shutdown could impact over 900 workers and hurt dependent industries in the Kariega and Gqeberha areas.
Goodyear to close down its manufacturing plant in the Eastern Cape, affecting 900 jobs. Picture: iStock
Department of trade, industry and competition officials are in discussions with the Goodyear tyre company in a last-ditch effort to stave off the closure of the company’s factory in Kariega in the Eastern Cape, which could cost more than 900 jobs.
Department spokesperson Yamkela Fanisi said this was to assess the possibility of a deal being struck along the lines of the one implemented by the Industrial Development Corporation (IDC) to avert job losses at ArcelorMittal.
The IDC provided a R1.68 billion facility to ArcelorMittal, leading to the deferring of the closure of two key steel mills in Newcastle and Vereeniging, saving 3 500 jobs.
Goodyear hasn’t expressed view on possibilty of IDC deal
Goodyear has not expressed a view on the possibility of a deal with the IDC, saying only it was committed to supporting affected employees through the process.
“The minister sees this as devastating for the economy,” said Fanisi.
Goodyear said Section 189A retrenchment notices have been served on workers.
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With secondary industries such as catering, security and corporate social investment projects dependent on Goodyear, the closure of its operations is expected to have a ripple effect on Eastern Cape communities.
Political economist Sam Koma said the ArcelorMittal-IDC model could be applied to avert the Goodyear crisis.
“The reasons ArcelorMittal announced the closure of its operations are similar to Goodyear: competition from cheaper products, mainly from China, and high electricity costs.
ArcelorMittal-IDC model could be applied
“There should be negotiations involving Goodyear, the trade, industry and competition and labour departments to arrive at a mutually beneficial outcome.”
SA Federation of Trade Unions general secretary Zwelinzima Vavi said: “This decision by a multinational which has operated in South Africa since 1932, is nothing short of economic betrayal of the workers and communities who built its profits over 90 years.
“Goodyear’s closure comes on the heels of another major blow: Conti-Tech, a subsidiary of Continental Tyres, is also winding down. “And in Gqeberha, Aspen Pharmacare is retrenching workers.”
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