AKRON-So far, both management and labor appear to feel good about their positions in the growing tire industry strike. The 8,000 United Rubber Workers walking the picket lines at eight tire plants around the U.S. are standing tall, living the basic right of the labor movement.
And the companies-Dunlop Tire Corp., Bridgestone/Firestone Inc., Pirelli Armstrong Tire Corp. and Yokohama Tire Corp.-remain convinced that they must have contract changes to stay competitive.
But if the work stoppages last past Labor Day, those outlooks are likely to change, according to industry observers.
By then workers will have had a mortgage payment or two due, along with meeting the everyday cost of living. And the original equipment model changeover will be complete, 1995 models will need OE tires and inventory slated for the replacement market could be depleted.
``Then, both sides will be hurting,'' said Harry Millis, an analyst with Fundamental Research Inc. ``After six weeks off, a strike begins to bite pretty hard. There will be lots of losers and probably few winners.''
From an industry standpoint, the earliest impact likely will be a large increase in imports-perhaps as much as 50 percent if the strikes continue, Mr. Millis said.
The eight tire plants on strike represent about 164,500 units of daily capacity-about 18 percent of the total in the U.S. and Canada.
Bridgestone/Firestone likely is in the best position to meet ongoing demand, observers said. The firm has seven North American tire plants not affected by the strike and can import from factories abroad.
BFS also is operating its struck plants at 15-20 percent capacity with salaried workers, a company spokesman said. Thus far, BFS said its only supply difficulties will be in the area of agricultural tires.
Paine Webber Inc. analyst Steven Girsky said it's likely the tire makers built up inventory, as the strikes weren't unexpected.
But as those inventories go down, other firms like Goodyear, Cooper Tire & Rubber Co., General Tire and Michelin North America will benefit despite plants that are running at or near capacity. ``Somehow operators are able to get tires made (if business is available),'' said Nick Colas, an analyst with First Boston Corp.
Any business lost now will be hard to regain later, said Scott Soffen of Lehman Brothers Inc. ``In an environment like we have right now, with replacement demand fairly strong and original equipment demand very strong, any sales a company loses because of a strike could be lost forever.''
Just how long the strikes will last remains unanswered, although both labor and management seem willing to stand their ground indefinitely.
With the drastic changes being sought, URW members aren't likely to give in until they feel their jobs are in jeopardy, Mr. Millis said. ``With the current demand and operating levels, it will be hard to convince them of that.''