Goodyear Tire Earnings Hit The Skids

Compiled By Peter Strozniak Goodyear Tire & Rubber Co., the world's largest tire manufacturer, is revising its third- and fourth-quarter earnings to break even or post a loss due to deteriorating global economic and industry-wide conditions. The Akron, Ohio-based company blames escalating raw material and energy costs, weak pricing conditions in global markets, lower-than-expected tire industry volumes in North America and Europe, and the continued decline of the euro's value against the U.S. dollar. Analysts had expected Goodyear to post 29 cents a share and 35 cents a share in the third and fourth quarters, respectively. Goodyear's third-quarter results are scheduled to be released Oct. 24. Although the company is benefiting from an increase in tire replacement sales because of the massive Bridgstone/Firestone recall, Goodyear says overall sales have declined. "Production cutbacks by original equipment customers in the auto and commercial truck industries are negatively impacting shipments," Goodyear reports. As a result, Goodyear has reduced third-quarter tire production beyond original expectations to maintain proper inventory levels, which has led to manufacturing inefficiencies and higher costs.

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish