Muscatine, IA-based truck retread manufacturer Bandag Inc. has announced closing its pension plans to new hires in the U.S. and Canada and that it will freeze the existing pension plans for salaried and hourly U.S. employees and for salaried Canadian employees effective Dec. 31.

In addition, Bandag is offering an early retirement program to eligible employees and has announced voluntary and involuntary separation programs for U.S. employees.

Bandag is also considering terminating the pension plans within the next 18 months, although no definitive action has been taken. The announcement follows the previously announced closing of its tread production facility in Shawinigan, Quebec.

"The North American markets for commercial replacement tires have changed irreversibly over the past several years, a situation exacerbated by record-high raw material prices and intensified competition," said chairman & CEO Martin G. Carver.

Overall, Bandag expects to reduce its U.S. based workforce by approximately 15%. The company hopes to achieve this through its early retirement and voluntary separation programs, but said it will lay off workers if not enough eligible employees accept packages.

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