TRELLEBORG, Sweden (Oct. 26, 2004) — Trelleborg A.B. is planning to phase out tire production at its headquarters plant in Trelleborg by year-end 2005 and has begun talks with relevant union representatives over the action.
Trelleborg said its decision is based on declining demand for bias-ply farm and forestry tires, which make up the Trelleborg plant's entire capacity. The Swedish plant makes about 4,000 metric tons of tires annually, which represents about half the company's annual production of bias-ply farm and forestry tires, much of which comes from subcontracted suppliers.
The decision would affect about 200 employees in Trelleborg—130 in production and 70 in administration. The company employs 730 in Trelleborg. The costs for the phase-out and related restructuring measures are expected to total $45 million before tax, Trelleborg said, which will be charged against earnings in 2004. The action should yield a positive effect on earnings starting in 2006 of about $10.5 million before tax.
Trelleborg makes radial agricultural tires at its Trelleborg Wheel S.p.A. plant in Tivoli, Italy.