The Goodyear Tyre & Rubber Company’s replacement tyre sales and other non-OEM business accounted for over 80% of total global sales in 2008, chairman and CEO Robert Keegan told the annual shareholder meeting. Sales to the ‘Detroit three’ automakers accounted for under 7% of the total.
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Keegan said he remained confident in Goodyear’s ability to drive performance during challenging economic conditions and emerge in a position of competitive strength.
This confidence, he said, derived from Goodyear’s “game tested” leadership team, a proven track record based on strong strategies and continued new product success, as well as actions the company was taking to improve its cost structure and strengthen its cash position.
Keegan identified three specific areas that he said would keep the company on its path toward success. These were: new product leadership, building core brand strength and leveraging its industry-leading distribution network; aggressively aligning the cost structure with today’s lower industry volumes; and focusing on the strength of the balance sheet and generating funds to reinvest in the business.
The company’s planned to launch over 50 new products in 2009.
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By GlobalData“During challenging economic times, new products, strong dealer support and innovative marketing programmes will be the core revenue-generating strengths for Goodyear,” Keegan said.
Keegan noted a significant decline in industry demand, especially in the fourth quarter of 2008.
“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 said.
Total sales of $19.5bn were about equal to 2007 despite the economic slowdown and there was an 8% increase in revenue per tyre. The company also achieved record sales in its Asia-Pacific, Latin America and Europe, Middle East & Africa businesses and record segment operating income in the Asia-Pacific and Latin America businesses.
It made over $700m in savings as part of its ‘4-point cost savings plan’.
Keegan said Goodyear’s goal in 2009 was 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.”
