Roy Armes, CEO of Cooper Tire & Rubber Co., said in a press conference to discuss the company's third quarter results, that given the scenarios in the period -- which included a softening demand for tires, continual high raw material costs and the banking crisis -- the company is taking appropriate steps for continual improvements going forward.
These steps include continual inventory management, tight controls on costs, continual monitoring of its production levels to match demand, the development of new products, ramped up low cost tire sourcing and increased plant automation.
The company is in the midst of a 90-day evaluation, to conclude no later than mid-Janyary 2009, that will help it decide what steps to take to remain at peak competitiveness. And one option includes a domestic plant closure, said Armes.
Its plants are currently running at reduced levels -- between 90% and 100% -- of capacity, he added. "Even taking one plant off-line, we could increase production at our remaining three plants," he pointed out.
He said the company is currently in the middle of negotiations with the Steelworkers at its Findlay, Ohio, plant, and "the union is acting responsibly" and he is pleased with the cooperation the union has shown thus far.
He sees higher inventories at Cooper's customers' shops, but feels that independent tire dealers are managing their cash closely and are responding well to the current economic environment.
The company plans to expand the Cooper brand in channels it's not currently involved in, said Armes. He also noted that its recently released products make up 20% to 30% of its revenues.
