Goodyear holds Web cast to discuss its focus on high-value-added tire production
What will Goodyear Tire & Rubber Co. discuss today at its live Web cast at 9 a.m.? Company strategies, according to Chairman, CEO and President Bob Keegan.
That includes capitalizing on worldwide increases in demand for its high-value-added tires, and differentiating its products in the minds of consumers.
The company also plans to build on its profitable businesses in the emerging markets of Latin America, Eastern Europe and Asia.
"Growth in markets such as China, Russia and Brazil and a transition to increasingly high-value-added tires in these markets represent significant opportunities," he says.
Here are some of the hot topics to be discussed:
* the impact of higher fuel prices, changing driving habits and a shift in vehicle preferences in the United States.
* Goodyear's decision to increase its cost savings target to more than $2 billion by 2009 -- a change from its prior goal of between $1.8 billion and $2 billion -- through intensified focus on efficiency throughout the supply chain and in back office operations.
* the announced closure of Goodyear's tire manufacturing plant in Somerton, Australia (see "Goodyear announces plan to close tire plant in Australia," June 25, 2008).
* the investment of up to $500 million to increase Goodyear's presence in China through a relocation and expansion of its manufacturing plant in Dalian to facilitate increased production of high-value-added consumer and commercial tires for the Asia-Pacific region.
* investments of $500 million to $700 million over five years to modernize four U.S. manufacturing plants to increase high-value-added tire production and improve cost efficiency.
* investments of up to $600 million to expand production in Brazil and Chile.
* investments of approximately $500 million to modernize and expand production in Germany and Poland.
"Going forward, we anticipate capital investments totaling between $1 billion and $1.3 billion per year from 2008 to 2010," says Keegan.
"Our plans, however, are flexible so that we can adjust both the pace and amount to reflect the macro-environment and market trends while maintaining positive cash flow. We will continue to be extremely analytic and hard-nosed with respect to the allocation of capital, and are focused on return on invested capital as a key financial metric."
The company expects to increase high-value-added capacity by 50% from 2006 levels, and to increase its low-cost capacity to 50% of its worldwide total by 2012.
To access the live Web cast of the 9 a.m. meeting, visit Goodyear's investor relations Web site at investor.goodyear.com. Presentation materials also will be posted to the web site.
A replay of the Web cast will be available on the Web site.