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For five years Uniroyal has been carrying out a rigorous program of merge and purge; by June it had axed 20 business units, accounting for $845 million in sales. Among them: its European operations and the domestic footwear division known for its Keds brand. Two weeks ago Chairman David Beretta acknowledged that "our U.S. tire losses are more than offsetting profits from our healthy non-tire operations."
And Uniroyal announced that it would close two of its five tire-making facilities, the plant on Detroit's Jefferson Avenue and one in Chicopee Falls, Mass., laying off 3,300 employees. Since 1975, the company's work force has been cut by 25,000, to about 38,000 today.
Uniroyal executives say that the firm is now stripped down and ready to face the 1980s. Industry observers say the stripping could cut the company's market share from 12% to 8%, but Uniroyal disagrees. It plans to prevent any erosion by increasing the capacity of its Eau Claire, Wis., plant and by going to seven-day production at the two remaining plants, both of them modern. The company supplies 30% of General Motors' tires, and GM is likely to remain a loyal customer. The non-tire divisions, including agricultural chemicals and rubber and plastic products, account for 47% of sales and are doing well. Indeed, some experts say Uniroyal may even make a small profit this year. But some Wall Street observers believe that Uniroyal should eventually get out of the tire business, where, in the words of Analyst Harry Millis of McDonald & Co., a Cleveland-based research firm, it "is losing its shirt." Having already cast aside a lot of weak operations, the tiremen are betting they will lose no more.