Goodyear Bullish About its Future

March 22, 2011
Company is aiming for record segment operating income of $1.6 billion in 2013.

Executives from Akron, Ohio-based Goodyear Tire & Rubber Co. today will discuss the company's strategies "to capitalize on industry and economic trends to achieve record levels of profitability," the company said.

Goodyear said it is targeting 2013 segment operating income in its North American Tire unit of $450 million and improved segment operating income in its international businesses.

In total, Goodyear is aiming for record segment operating income of $1.6 billion in 2013.

Kramer: Industry trends "favor Goodyear and our well-established innovation capability."
"Having momentum coming out of the deep economic recession, we are now positioned to confidently drive higher levels of performance across our businesses," Chairman and CEO Richard Kramer said.

Over the next decade, Kramer said the company sees the industry being influenced by seven "mega trends" that "favor Goodyear and our well-established innovation capability."

"We have a clear view of our destination as a business and well-defined strategies for driving value going forward," Kramer said. "Our focus will be winning in the segments where the highest profits are available for Goodyear and for our customers."

Company Will Invest in Plant Modernization

The company anticipates making capital investments of between $1.1 billion and $1.3 billion per year in 2012 and 2013, up slightly from an expected $1.1 billion to $1.2 billion in 2011. Between $500 million and $600 million each year will be focused on profitable growth opportunities through plant modernizations, expansions and new construction, according to Goodyear.

The investments will support a 3% to 5% annual increase in unit volume, focused on high-value-added tires in high-margin segments, according to the company.

Goodyear expects to reduce its underfunded pension obligations to $1.2 billion -- or by more than half -- by 2013. It expects to make pension contributions of $550 million in 2012 and $525 million in 2013 in addition to contributions of approximately $275 million in 2011.

As a result of these planned actions, the company's pension expense is expected to decrease by $100 million a year by 2013.

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About the Author

Josh Cable | Former Senior Editor

Former Senior Editor Josh Cable covered innovation issues -- including trends and best practices in R&D, process improvement and product development. He also reported on the best practices of the most successful companies and executives in the world of transportation manufacturing, which encompasses the aerospace, automotive, rail and shipbuilding sectors. 

Josh also led the IndustryWeek Manufacturing Hall of Fame, IW’s annual tribute to the most influential executives and thought leaders in U.S. manufacturing history.

Before joining IndustryWeek, Josh was the editor-in-chief of Penton Media’s Government Product News and Government Procurement. He also was an award-winning beat reporter for several small newspapers in Northeast Ohio.

Josh received his BFA in creative writing from Bowling Green University, and continued his professional development through course-work at Ohio University and Cuyahoga Community College.

A lifelong resident of the Buckeye State, Josh currently lives in the Tremont neighborhood of Cleveland. When the weather cooperates, you’ll find him riding his bike to work, exercising his green thumb in the backyard or playing ultimate Frisbee.  

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