Goodyear has reported a record full year, boosted by the company's efforts to sell higher margin lines.

The tyre maker's sales for 2007 were a record $US19.6bn, a 5% increase over 2006 despite a 6.2% decline in tyre unit volume. Segment operating income was $1.2bn, compared to $712m in 2006.

Goodyear's income from continuing operations of $139m in 2007 compares to a 2006 loss of $373m. Including discontinued operations, Goodyear had 2007 net income of $602m, compared to a loss of $330m last year.

In a statement, the company said: "Improvements in pricing and product mix of approximately $639m offset higher raw material costs, which increased 3.5%, or approximately $195m, compared to 2006. Revenue per tyre increased 8% compared to 2006."

Goodyear's fourth quarter 2007 sales were $5.2bn, an 11% increase compared with the 2006 quarter, offsetting lower volumes with higher prices and a richer product mix. The company said it estimates that a 12-week strike at its North American facilities in 2006 reduced fourth quarter 2006 sales by $318m.

Improved pricing and product mix drove revenue per tyre up 10% over the 2006 quarter.

"Lower volumes reflect weak winter tyre demand in Europe and the company's exit from certain segments of the private label tyre business in North America along with weak conditions in several key markets," Goodyear said.

"Our fourth quarter results show[ed] significant gains as we drive sales of our higher-margin premium product lines," said chairman and chief executive officer Robert Keegan.

"This is especially true in our emerging markets businesses in eastern Europe, Asia and Latin America. In aggregate, these three businesses grew sales 20% and segment operating income 41% in the quarter," he added.

"Excluding the impact of the strike, North American Tyre's focus on innovative new products helped it achieve its highest full-year segment operating income since 2000," he said. "Our new product engine will provide additional growth opportunities in 2008 and beyond."

Goodyear said it had made further progress during the fourth quarter on its plan to achieve $1.8bn to $2bn in gross cost savings by the end of 2009.

"We have now achieved more than $1bn in savings in 2006 and 2007 and clearly remain on target to reach our four-year goal," Keegan said.