Goodyear is on pace to reach its goal of debuting more than 50 new products by the end of the year. The company had 19 launches during the recently concluded second quarter, joining the 23 releases achieved in the first quarter.
“The emphasis that we place on innovation and our new product engine has been unrelenting,” says Robert J. Keegan, chairman and CEO. “We are now expanding our efforts in the high-volume, profitable mid-tier market segment, which is providing us market momentum despite the lower industry volume levels,” he adds.
“There is little debate as to the severity of the economic and industry downturn we have experienced the past three quarters,” Keegan continues. “We are beginning to see some signs of economic stabilization and recovery, although still fragile at this stage and varied around the globe,” he says.
“Despite the significant impact this has had on our performance, we had a respectable and encouraging second quarter,” according to Keegan. “Our results strengthened compared to the first quarter as reduced raw material costs and our strategic actions aimed at our top line, cost savings and cash generation continue to have the desired effect. Our intense focus on emerging from the downturn in a position of strength is helping us significantly improve our competitiveness today.”
The company says it made additional progress during the second quarter on its Four-Point Cost Savings Plan to achieve $2.5 billion in gross savings by the end of 2009. It saved $200 million during the second quarter for a total of $345 million in the first half of this year.
Goodyear slashed 1,700 jobs during the second quarter, on top of the 3,800 jobs lost in the first quarter. The company plans to cut a total of 5,000 positions this year, Keegan says.
Manufacturing capacity in France has been reduced by about 6 million tires; another 2 million are to be eliminated by shuttering a plant in the Philippines. “These actions are part of Goodyear’s strategy to reduce inefficient manufacturing capacity around the world by 15 million to 25 million units.”
The company’s supply chain initiative has resulted in inventory levels that are nearly $700 million below the year-end 2008 figures.
“Today we are a leaner, more efficient company,” says Keegan, noting that it has “expanded both our capabilities and our competitiveness globally, and (we) have further enhanced our solid cash and liquidity position.”
For more information, visit www.goodyear.com/corporate.
