The Story Of Survival From Closure Of A Major Tire Plant

Tire making has been a major player in Alabama's industrial economy. Between them, Goodyear and B.F. Goodrich employed some 9,000 Alabamians But the 1990s saw the beginning of the end of tire production in the state and forced impacted communities to find a way to survive and prosper.

The Opelika Story

Michelin closed its East Alabama B.F. Goodrich plant in Opelika permanently in 2009, with more than 1,000 workers losing their jobs.

Lee County faced a major economic loss but Opelika Mayor Gary Fuller, business leaders and Auburn University formed a partership to pick up the slack. Out of that came an aggressive effort to diversify industrial recruitment, take advantage of regional automotive expansion, push strong workforce retraining, and foster downtown revitalization.

Fuller said at the time, "We see the glass as half full, because now we have a pool of highly qualified employees with a great work ethic and we're marketing that as we speak." A  Consultingcompany was hired to provide guidance in replacing jobs and help develop a plan forward.

Although Michelin closed the Opelika Goodrich plant to consolidate production, they opened the Michelin Development Office for East Alabama. This provided over $2 million in low-interest loans to help stimulate new, homegrown small businesses.

The region also benefited heavily from the arrival of the Kia manufacturing plant just across the stateline in nearby West Point, Georgia, which was able to absorb many of the former Goodrich workers.

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The Gadsden Story

The Goodyear Tire Plant in Gadsden produced its first tires in 1929, opening just four months before the stock market crash. But the 2.9 million sq. foot plant was able to survive "The Great Depression" to become the largest tire manufacturing facility in the world. At its peak, employing more than 4,000 workers. But the boomtimes began coming to an end in the 1990s.

Clues about the future of the plant began showing up in the late 1990s with temporary closures, layoffs, rehiring, and reorganization. That led to the beginning of the end in April 2019 when an estimated quarter of the employees were laid off, and buyouts were offered later in the year.

Then, after 90 years of continuous operation, citing competition from cheaper tires produced in Mexico, the company that had employed generations of families ceased operations in 2020. It brought a pall to Northeast Alabama because it had been the economic backbone of the region. The state's economy also took a major hit and the closure left Gadsden and Etowah County leaders trying to figure out how to survive such an industrial loss.

The Economic Development Association of Alabama went to work with local leaders to develop a plan for the way forward.

The facility was basically empty for two years until Phoenix Investors purchased the property with the goal of somehow revitalizing the massive site. They were successful in revitalizing the complex when it was leased by the global energy logistics company Takkion to use as a storage and handling hub for renewable energy resources such as solar panels.

So, what helped Gadsden survive and now prosper? Three main things:

• A massive severance package for employees in a lump sum payment based on years of service help families pay the bills,
• Actively diversifying the area's manufacturing base with smaller companies such as automotive suppliers for Alabama's massive auto producing industry, logistics operations, and
• Finding Takkion and other businesses as new residents for the old plant site.

Gadsden is now recognized as being one of the nation's and state's "boomtowns". The city's budget is the largest in history at $80 million and has been increasing at an annual 10% rate, the area is experiencing steady job growth adding an average of 25 new ones per month and development of the $115 million "Rise Plan" to improve the city's infrastructure and recreational facilities.

The Tuscaloosa Story

The announcement that the Michelin owned B.F. Goodrich plant will begin two-year closure operations caught most people off-guard and while it will have a significant impact on the area, and those losing jobs, it should not produce the same pain the Gadsden Goodyear and Opelika B.F. Goodrich closing initially had on their communities.

Tuscaloosa's industrial and economic base is far larger and more diversified than was Opelika's in 2009 or Gadsden's in 2020. Five other emploers lead the Tuscaloosa job base above B.F. Goodrich. However, the loss of 1,200-plus jobs does leave an impactful hole, especially those left looking for other employment.

"While the full impact is not yet known, I want to assure our community that the City of Tuscaloosa will stand side-by-side with our state and local partners to support affected workers, stabilize our economy, and determine the best path forward." Mayor Walt Maddox stated in his reaction to the news.

Tuscaloosa city and county officials and industrial development representatives have already started meeting with state industrial development officials to work on the way forward.

The two-year shutdown operations announcement comes amid a string of successful industrial recruitments to Alabama. It also gives local officials time to figure out a community strategy. Hopefully the state can continue to build on their success to fill the hole left by B.F. Goodrich in Tuscaloosa. There are two years ahead to accomplish that before closure.

As Opelika and Gadsden proved, losing a major employer is not the end but can actually be the beginning of good things to come.