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Blowup At Bridgestone


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BLOWUP AT BRIDGESTONE

Thunder" Thornton, a machine operator at Bridgestone/Firestone Inc.'s tire plant in Des Moines, figured from the start it would be a long strike. "They were out to starve us to death, and they've done a pretty good job of it," says the 31-year company veteran.

The six-month standoff between Bridgestone and the United Rubber Workers (URW) indeed has turned into an acrimonious confrontation. On Jan. 18, after months of secret talks--and two weeks after the company revealed it had hired permanent replacement workers--both sides sat down with federal mediators. But Bridgestone officials indicated even before the meeting began that they weren't likely to rehire all the striking workers, and union officials said their prospects looked bleak.

If this were just a strike, the matter might end there: Big Labor, representing just 11% of America's private-sector workers, rarely gets front-page treatment anymore. But the Bridgestone battle has spiraled into a remarkable political spat, replete with tense diplomatic dialogue and high-level snubs.

The Clinton Administration has seized on the dispute, finding in the rubber workers a vehicle to score points with organized labor and, as well, with conservative Democrats and suburban independents. The fact that the employer is a Japanese company, at a time when trade relations with Tokyo are faltering badly, hasn't hurt. For Clinton, says adviser Paul E. Begala, the strike "has a special saliency. It doesn't matter if you are in a labor union. It's a matter of common decency." Translation: This one can win votes.

The President has publicly criticized Bridgestone's January hiring of 2,300 permanent replacement workers. Labor Secretary Robert B. Reich complained loudly after the company's top U.S. official declined to meet with him about the issue. And at a formal White House luncheon during the Japanese Prime Minister Tomiichi Murayama's January visit, Ambassador Walter F. Mondale took the highly unusual step of raising the matter with the Japanese Foreign Minister.

All this has enveloped a company that once seemed a model of management-labor cooperation. After Japan's Bridgestone Corp. bought Firestone Tire & Rubber Co. in 1988, labor relations were downright friendly. Management even allowed the URW to represent workers at a new plant.

DESTABILIZING. But the coziness vanished after the company posted a total of $1 billion in losses by 1992, and after the ascension of cost-cutter Yoichiro Kaizaki to head Bridgestone/Firestone in 1991--and, later, its Japanese parent. Kaizaki, and then Masatoshi Ono, his replacement in the U.S., abandoned the cooperative relationship and girded for a showdown in April, 1994, when the labor pact was set to expire. The company padded inventory by buying more than 500,000 tires from rival Cooper Tire & Rubber Co. Bridgestone in Japan agreed to supply another 3 million tires, according to a 1993 memo from Ono that the union released. Bridgestone headquarters denies knowledge of the memo.

Armed with inventory, management demanded that the URW break with the contract it ratified in June with Goodyear Tire & Rubber Co., which called for a 16% increase over three years. In its place, Bridgestone asked for 12-hour shifts, pay hikes tied to productivity goals, health co-payments, and lower new-hire pay--all to overcome what it called big cost disadvantages. The union balked. "They're trying to destabilize the North American tire industry," says URW President Kenneth L. Coss.

On July 12, 4,200 union members walked out at five plants covered by the contract. Reich criticized Bridgestone for its refusal to accept the pattern contract agreed to at Goodyear. This wasn't Bridgestone's first run-in with the Labor Secretary. In April, Reich had flown to the tiremaker's Oklahoma City plant to personally slap the company with a $7.5 million fine for alleged safety violations. The case is still pending.

A series of secret talks went nowhere over the next few months, even though insiders say the union agreed to concessions. In the meantime, Bridgestone's stockpile, and production from its other union and nonunion factories unaffected by the strike, allowed it to keep most major customers supplied. "It's almost like the strike never existed," says Larry Morgan, chairman of Don Olson Tire & Auto Centers in Clearwater, Fla.

REBUFFED. On Jan. 4, Bridgestone announced it had hired 2,000 permanent replacements. The move struck a nerve in the Administration, which supports a law to limit employers' ability to replace strikers for good. Reich, who has intervened in six major strikes, tried to speak with Ono, and with Kaizaki, hoping to get the two sides talking again. Instead of quietly agreeing, Bridgestone rebuffed Reich, saying Ono was unavailable and offering its labor chief instead.

An angry Reich complained to Clinton, and the President seized the chance to curry favor with Labor. Though his support of the striker replacement bill last year was halfhearted, Clinton still wants to appeal to workers alienated by his support for issues such as NAFTA.

At the White House luncheon on Jan. 11, Mondale told Japanese Foreign Minister Yohei Kono that Ono should speak with Reich. Two days later, Clinton himself weighed in. In a statement, he said he had "long supported legislation to prevent companies from permanently replacing their striking workers. Now Bridgestone/Firestone's use of permanent replacements shows exactly why this protection is necessary."

Bridgestone had alienated other U.S. policymakers as well. A group of four Democrats led by Senator Paul Simon (D-Ill.) tried several times to intervene in the dispute. After a November visit to Japan's U.S. Ambassador came to naught, the Senators got Senate leaders to give Murayama a letter protesting Bridgestone's actions. Simon also raised the issue with the Prime Minister when he visited the Senate floor on Jan. 11. Finally, the next day, Ono said the company would meet with the union. And Ono agreed to meet Jan. 23 with Reich, although there's no evidence that Japanese officials pressured him to act.

New talks may not help. Bridgestone already has said some strikers will lose their jobs, making it politically difficult for the URW to return to work. The company's new 12-hour shifts may require a larger workforce. But with just 800 union line-crossers and 300 more replacements hired after the first 2,000, Bridgestone says it's running the struck plants at 70% or more of normal production.

Indeed, Bridgestone likely will win. And to Clinton's attack, it responds: "Our offer to the URW is in keeping with Mr. Clinton's stated goals of U.S. economic growth and American competitiveness in the global marketplace." It sounds smug. Still, U.S. officials vow to keep up their attack, even in a losing cause. "We plan to keep the pressure up on both sides," vows Steven Rosenthal, an assistant to Reich. If so, this international incident may be far from over.

ANATOMY OF AN INTERNATIONAL INCIDENT

1993

The United Rubber Workers charge Bridgestone with organizing other tire makers to prepare for a strike, an assertion the company denies.

APR. 18, 1994

Labor Secretary Robert Reich, at an Oklahoma City plant, fines Bridgestone $7.5 million for allegedly violating safety standards. The case

is now in administrative review.

APR. 23

URW contracts with major tiremakers expire. After the union settles with Goodyear in June, negotiations resume with Bridgestone. But the company refuses a "pattern" settlement, and the union rejects Bridgestone's proposal.

JULY 12

More than 4,000 workers under URW President Kenneth Coss strike five Bridgestone/Firestone factories. Reich blasts the company for its bargaining stance.

AUGUST

Bridgestone implements parts of its contract proposal. It operates the struck plants with salaried personnel and some new workers, though below capacity. Later, the company and the URW charge each other with unfair labor practices.

JAN. 4, 1995

Bridgestone says it has hired more than 2,000 permanent replacement workers. Reich attempts unsuccessfully to meet with Bridgestone/Firestone CEO Masatoshi Ono.

JAN. 11

Ambassador to Japan Walter Mondale tells Japanese Foreign Minister Yohei Kono at a White House state luncheon that Ono should meet with Reich.

JAN. 13

Bridgestone agrees to meet with the URW and U.S. mediators. (Ono later says he is willing to talk with Reich.) President Clinton criticizes the company for hiring replacements.By Zachary Schiller in Cleveland, with Douglas Harbrecht in Washington and bureau reports


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