"We just sent a letter to Goodyear informing them that it is unacceptable to demand suppliers take responsibility for any damage caused by defective products," Thai Rubber Exporters' Association president Choosit Opaswonse said.

Goodyear, one of the world's leading tyre makers, has sent a letter to most suppliers and exporters in the three rubber producing countries, informing them that they must assume responsibility for any damage.

"What we are really concerned about is that what would happen if in future Goodyear faced the same problem as Bridgestone's on a massive tyre recall.

According to the new condition, Goodyear can put the blame on suppliers and it is us who have to pay for any costs incurred," said Mr Choosit.

Usually, suppliers sell rubber on an FOB (Free on Board) basis, transferring ownership at the point that the rubber is loaded onto the ship.

It means that suppliers do not take any responsibility for any damage incurred after the rubber is shipped from its FOB Port.

Ohio-based Goodyear said in the letter that it could no longer absorb financial losses caused by suppliers' errors.

"Goodyear can no longer absorb financial losses caused by suppliers' errors," vice president, JC Whiteley of the firm's department of global product and process quality said in the letter.

"Accordingly, we will be charging back, via deductions from invoices, Goodyear's cost for rework, material losses, extra labour, downtime, and other costs incurred due to supplier failures to meet our quality, delivery and other requirements."

Exporters in Thailand, the world's largest rubber producer and exporter, said they needed more specifics.

"The letter is so vague and broad, especially the phrase' other costs incurred due to supplier failures', what does that mean?... It could be anything, the scope is so limitless," said Mr Choosit.

Thailand, Indonesia and Malaysia account for almost 80 per cent of the world's natural rubber production.

(Reuters)