| Type | Subsidiary of Bridgestone |
|---|---|
| Industry | Manufacturing |
| Founded | Akron, Ohio (1900) |
| Headquarters | Nashville, Tennessee, United States |
| Key people | Mark A. Emkes, CEO Ken W. Weaver, CEO, Firestone Diversified Products |
| Products | Tires |
| Revenue | $2.09 billion USD (2004) |
| Employees | 23,000 |
| Website | www.firestone.com |
The Firestone Tire and Rubber Company is an American tire company founded by Harvey Firestone in 1900 to supply pneumatic tires for wagons, buggies, and other forms of wheeled transportation common in the era. Firestone soon saw the huge potential for marketing tires for automobiles. The company was a pioneer in the mass production of tires. Harvey Firestone had a friendship with Henry Ford. Firestone used this relationship to become the original equipment supplier of Ford Motor Company automobiles, and was also active in the replacement market.[1]
In 1988, the company was sold to the Japanese Bridgestone Corporation.
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Firestone was originally based in Akron, Ohio, also the hometown of its archrival, Goodyear Tire and Rubber Company. The company initiated operations in 1900 with 12 employees.[2] Together, Firestone and Goodyear were the largest suppliers of automotive tires in North America for over three-quarters of a century. In 1906 Firestone was chosen by Henry Ford for the Model T.[3]
In 1919, Firestone Tire and Rubber Company of Canada was incorporated in Hamilton, Ontario and in 1922, the first Canadian-made tire rolled off the line on September 15.[4] During the '20s, Firestone produced the Oldfield tire, named for racing driver Barney Oldfield.
At one point, the company had a rubber plantation in Liberia that covered more than 4,000 square kilometers (1 million acres).
The company sponsored The Voice of Firestone on the radio beginning on December 1928. The program was transferred to television as an NBC simulcast on 5 September 1949. The last broadcast was in 1963.[5]
In 1928 the company built a factory in Brentford, England, for long an Art Deco landmark on a major route into the city. This closed in 1979.
During World War II the company was called on by the U.S. Government to make artillery shells, aluminum kegs for food transport and other rubberized military products. In the 1940s, Firestone was given a defense contract to produce plastic helmet liners. While outproduced by Westinghouse Electric they still made a fair amount for the M1 Helmet.
In 1951, Firestone was given the defense contract for the MGM-5 Corporal missile. Firestone was given a total of US$6,888,796 for the first 200 Missiles. This missile was known as the "Embryo of the Army" and was a surface-to-surface guided missile which could deliver a high explosive warhead up to 75 nautical miles (139 km). It was later modified to be able to carry a nuclear payload for use in the event of Cold War hostilities in Eastern Europe. This missile was replaced in 1962 by the MGM-29 Sergeant system.[6]
In 1961, Firestone acquired the Dayton Tire division from the Dayco Corporation.
In late 1979, Firestone brought in John Nevin, the ex-head of Zenith Electronics, as president to save the hemorrhaging company from total collapse. It was more than a billion dollars in debt at the time, and losing 250 million dollars a year. Nevin closed nine of the company's seventeen manufacturing plants, including six in one day. He moved the company from its ancestral home in Akron to Chicago. He spun off non-tire related businesses, including the Firestone Country Club. It was considered a deliberate plan to boost the stock price, and it paid off. In 1988 after discussions with Pirelli, Nevin negotiated the sale of the company to the Japanese company Bridgestone. Bridgestone Corporation Japan was able to buy the company for much less than it had been worth a decade and a half earlier.[7][8][9] The combined Bridgestone / Firestone North American operations are now based in Nashville, Tennessee.
Apart from tires, Firestone operates several businesses under the Firestone Diversified Products umbrella. These companies include Firestone Building Products, Firestone Industrial Products Company, Firestone Complete Auto Care, Firestone Natural Rubber Company and Firestone Specialty Products. Firestone Diversified Products is headquartered in Indianapolis, Indiana and operates in 23 U.S. states and ten countries, with 11,000 employees worldwide. Annually, the company reports annual sales of more than $2.5 billion.[10]
In 1972 Firestone received a ten year import "concession" by the Kenyan government to secure Firestone's investment in a domestic tire plant, which gave it a virtual monopoly.[11] This included both general price and foreign exchange controls. [12]When the ten year period came to an end in 1979, Firestone retaliated by increasing production, making entry less attractive.[13] Headquarters eventually canceled expansion and failed negotiations lead to no further investments. [14]
In 1950, Firestone along with General Motors and Standard Oil were charged and convicted of criminal conspiracy for their part in the Great American streetcar scandal. The scandal included purchasing streetcar systems throughout the United States and dismantling and replacing them with buses.[15]
Radial tires were introduced to the US market by rivals Goodrich and Michelin in the late 1960s, and Firestone lacked their own product line. The first radial tire developed and produced by Firestone was the ill-fated Firestone 500 Radial. Manufacturing of the new tire was performed on equipment designed to manufacture bias-ply tires.
During the 1970s, Firestone experienced major problems with the Firestone 500 radial. The Firestone 500 steel-belted radials began to show signs of separation of the tread at high speeds. While the cause was never proved, it is believed that the failure of bonding cements, used by Firestone to hold the tread to the tire carcass, may have allowed water to penetrate the tire which in turn may have caused the internal steel wire to corrode. In March 1978, the U.S. National Highway Traffic Safety Administration (NHTSA) announced publicly a formal investigation into defects of the Firestone 500. The NHTSA investigation found that the tread separation problem was most probably a design defect affecting all Firestone 500's.
In 1973, only two years after the 500's debut, Thomas A. Robertson, Firestone's director of development wrote an internal memo stating "We are making an inferior quality radial tire which will subject us to belt-edge separation at high mileage".[16] Firestone introduced strict quality control measures in an attempt to fix the inherent problems, however they were not successful in totally eliminating the basic faults. In 1977 a recall of 400,000 tires produced at the problematic Decatur plant was initiated. Firestone was considered to be less than cooperative with the NHTSA during the agency's investigation into the Firestone 500. Firestone blamed the problems on the consumer, stating underinflation and poor maintenance.
On October 20, 1978, Firestone recalled over 7 million Firestone 500 tires,[17] the largest tire recall to date. Congressional hearings into the 500 also took place in 1978. The tire was found to be defective and the cause of 34 deaths. In May 1980 after finding that they knew the tires were defective, the NHTSA fines Firestone $500,000 USD, which at that time was the largest fine imposed on any U.S. corporation and the largest civil penalty imposed since passage of the 1966 National Traffic and Motor Vehicle Act. Multiple lawsuits were settled out of court and the constant negative publicity crippled the company's sales and share price.[18]
Harvard Business School and Wharton School taught classes and wrote papers on the issues of misjudgments and poor decision making by the management of Firestone.[18][19] After years of bad publicity and millions paid out in compensation to victims, Firestone was losing vast amounts of money, and its name was severely damaged.[20][21][22][23]
In 1926, Firestone opened one of the world's biggest rubber plantations in Liberia, West Africa. In 2005, a case against Firestone[24] was brought by the International Labor Rights Fund which states,
| “ | The Plantation workers allege, among other things, that they remain trapped by poverty and coercion on a frozen-in-time Plantation operated by Firestone in a manner identical to how the Plantation was operated when it was first opened by Firestone in 1926 | ” |
Firestone's management rejects these allegations citing that the corporation has provided employment and pensions to thousands of Liberians as well as health care. The company also provides education and training opportunities to employees and their children.[25]
In May 2006, the United Nations Mission in Liberia (UNMIL) released a report detailing the state of human rights on Liberia's rubber plantations. According to the report, Firestone managers in Liberia admitted that the company does not effectively monitor its own policy prohibiting child labor. UNMIL found that several factors contribute to the occurrence of child labor on Firestone plantations: pressure to meet company quotas, incentive to support the family financially, and lack of access to basic education. The report also noted that workers' housing provided by Firestone has not been renovated since the houses were constructed in the 1920s and 1930s.[26]
Dan Adomitis, President of Firestone Natural Rubber Company, made the following statement on CNN in reference to the production quotas and child labor:
| “ | OKE: The individual workload is reasonable, says Dan Adomitis, president of Firestone Natural Rubber.
ADOMITIS: Well, I think the work is fairly balanced, we - each tapper will tap about 650 trees a day, where they spend perhaps a couple of minutes at each tree. |
” |
In response to the accusations of child labor and poor housing in the UN report, Dan Adomitis; President of Firestone Natural Rubber Company Liberia; stated:
| “ | Well, in addition to the devastation that 15 years of civil war has caused, I think you need to understand another point -- during the 2003 fighting, we had thousands of refugees come to Harbel for the safety that it provided. When those people came, they occupied any open area of land that was available. They put up temporary housing made out of mud, out of bamboo, out of thatch, out of tarpaulin, out of corrugated steel. Anything that they could do to get shelter. And those conditions still exist. They are not Firestone housing, but they are on our property.[27] | ” |
| “ | We have very strict policies about child labor. We do not hire anybody under 18 years of age, and we discourage parents from bringing their children to the fields with them. We have a program with the Ministry of Labor in Liberia to - and also the union that represents our employees -- to educate parents about why they should not bring children with them into the field. And if we see incidents of this, we will cancel those employees, and if necessary, ultimately discipline them over such issue.[27] | ” |
| “ | Dan MacDonald, director of media relations for Bridgestone-Firestone, sought to contextualize the statement of Mr. Admonitis, pointing out that "a couple of minutes" is "a figure of speech." "He was not answering the question in the context of a time study--he was being conversational in a live interview setting," Mr. MacDonald told SocialFunds.com. "It takes a matter of seconds to tap a tree." .[28] | ” |
In 1996, several state agencies in Arizona began having major problems with Firestone tires on Explorers. According to news reports, various agencies demanded new tires, and Firestone conducted an investigation of the complaints, tested the tires and asserted that the tires had been abused or under-inflated.
On September 6, 2000, in a statement before the US Senate Appropriations Transportation subcommittee the president of the consumer advocacy group Public Citizen, Joan Claybrook, stated:
| “ | ...There are a number of parallels between this recall in 2000 and the 1978 recall of the Firestone 500....there was a documented coverup by Firestone of the 500 defect, spurred by the lack of a Firestone replacement tire. When the coverup was disclosed, the top management of the company was replaced as Firestone was severely damaged in reputation and economically. But a key difference is that the Firestone 500 was used on passenger cars, which rarely rolled over with tire failure. NHTSA documented 41 deaths with the 500, a recall, involving seven million tires.[29] | ” |
The report went on to indicate that Ford also had a major role in the problems stating that The Ford Motor Company had instructed Firestone to add a nylon ply to the tires it manufactured in Venezuela for additional strength and that Ford had made suspension changes to the Explorer model available in Venezuela. Ford did not specify adding the nylon ply for U.S.-made Firestone tires nor did it change the Explorer suspension on US models at this time.
An abnormally high failure rate in Firestone's Wilderness AT, Firestone ATX, and ATX II tires resulted in multiple lawsuits, as well as an eventual mandatory recall. In 2001 Bridgestone/Firestone severed its ties to Ford citing a lack of trust. The lack of trust stemmed from concerns that Ford had not heeded warnings by Bridgestone/Firestone relating to the design of the Ford Explorer.[30] In 2006, Firestone announced renewed efforts to recall tires of the same model recalled in 2000 after the tires were linked to recent deaths and injuries. Although Firestone estimates 97% of the tires were replaced in the 2000 recall concern existed over spare tires that many owners did not think to replace during the 2000 recall.[31] Part of this effort was a new advertising campaign in an attempt to reach the 5% of customers that still had not acted on its voluntary recall program. The recall/replacement program was supported by a comprehensive advertising and consumer outreach campaign and over 6.3 million tires were replaced of the total 6.5 million affected. While the company believes that most of those tires unaccounted for have probably been scrapped long ago it is still trying to locate as many as possible.[32]
Where the Rubber Meets the Road[33] is an advertisement jingle that was frequently used in the 1960s and 1970s, especially on televised sporting events.