Goodyear is planning more than 50 new global product launches this year as the company’s top executive reports that his “confidence is strengthened by the support of Goodyear’s dealers and their enthusiasm.”
This confidence, says Robert J. Keegan, chairman and CEO, also derives from the company’s “game tested” leadership team, a proven track record based on strong strategies and continued new product success, as well as actions being taken to improve its cost structure and strengthen its cash position.
“It is very clear to us that given the challenging 2009 economic environment, our intense focus on the Seven Strategic Drivers remains a solid strategic foundation,” Keegan points out. “As we address our market challenges head-on, we are not creating a new path. Rather we will be taking a proven path to the next level.”
Keegan identifies three specific areas that he believes will keep the company on a path toward success:
- Top line – encompassing new product leadership, building core brand strength and leveraging the distribution network;
- Lowering costs – aggressively aligning the company’s cost structure with today’s lower industry volumes; and
- Managing for cash – focusing on the strength of the company’s balance sheet and generating funds to reinvest in the business.
Among the new products for 2009 is the recently released Assurance Fuel Max tire that provides 27 percent less rolling resistance than the standard Assurance, equating to a 4 percent improvement in highway fuel economy.
“During challenging economic times, new products, strong dealer support and innovative marketing programs will be the core revenue-generating strengths for Goodyear,” Keegan says.
Commenting about the impact economic conditions had on the tire industry and on Goodyear in 2008, Keegan discusses a significant dip in industry demand, especially in the latter part of the year.
“However, we should not let the global economic decline overshadow the many positive actions that we took and the results that we achieved in 2008 as we successfully executed against our proven strategies,” he says.
According to Keegan, significant accomplishments in 2008 included:
- Total sales of $19.5 billion, about equal to 2007 despite the economic slowdown;
- An 8 percent increase in revenue per tire;
- Record sales for the Asia-Pacific, Latin American, European, Middle Eastern and African divisions;
- Replacement market tires and other products unrelated to original equipment were more than 80 percent of the global figures, with sales to the Detroit 3 automakers now less than 7 percent of the total.
- Record segment operating income in the Asia-Pacific and Latin American divisions;
- Goodyear-brand market share gains in major markets; and
- More than $700 million in savings as part of the 4-Point Cost Savings Plan.
Keegan says the company’s goal in 2009 is to reward the confidence and support of its dealers and shareholders by “aggressively positioning Goodyear to weather this economic storm and to seize upon the opportunities when our markets rebound, as they inevitably will.”
For more information, visit www.goodyear.com/corporate.
