Keegan outlines Goodyear's goals over the next three years
Goodyear Tire & Rubber Co.'s vision statement calls for some aggressive goals to be reached by the company, particularly in North America, by the end of 2005.
CEO and President Bob Keegan outlined Goodyear's vision, which is based on its three-year turnaround plan, at an investor conference call following the release of its financial results for the first quarter (Goodyear reported a $163.3 million loss in the first quarter).
Goodyear will look at stabilizing its business in North America in 2003, while "2004 becomes a year of traction, no pun intended," he said.
By 2006, Goodyear plans to have accomplished the following:
* a 2-point gain in tire market share in North America.
* a global increase in tire market share.
* a 4% gain in tire revenue.
* a $1 billion to $1.5 billion reduction in costs.
* a 6% return on sales.
* a 15% to 20% return on invested capital.
* reduction in debt.
Goodyear also has a goal of increasing its inventory turns by two by 2005.
Keegan also outlined some of the ways Goodyear will accomplish these goals. The company will focus on its core business, tires, and become market-focused. "Our company's been too inwardly focused."
Also, the company is striving for "superior" products and services and investor returns.
"Clearly, we need a significantly reduced cost structure to be competitive," he said. "The clock is ticking." To that end, simplifying the way the company works, reacts and does business is necessary.
"We're talking about big changes here in order of magnitude." To that end, Keegan says the company will eliminate some private brands, skus, "in some cases customers," and staff over time.
On the product side, Goodyear will focus on high-volume, high-growth markets. It also will be selective with original equipment fitments.