Coming off best quarter in years, Goodyear eyes future warily
Goodyear Tire & Rubber Co.'s third quarter North American Tire business was the company's "best quarterly performance in three years," Goodyear Chairman and CEO Sam Gibara declared during a late-morning press conference today.
"North American Tire did well in a difficult environment," he said.
Goodyear's total North American sales jumped 8% during Q3 2001, Gibara reported.
"Revenue-per-tire has increased from $62.16 (last year) to $64.88 this quarter."
Despite these gains, Gibara says the next quarter "is very uncertain" and declined to speculate on results.
Goodyear also expects lower volumes in 2002. "We're looking at original equipment business to be stable to down from this year" with replacement business to drop an estimated 2% to 3%.
"The good news next year may be from truck tires... the market may have bottomed out."
Gibara says Goodyear's costs in 2002 will be lower than its costs this year due to the tiremaker's global restructuring program.
By the end of last month, the company had slashed 7,500 jobs. Earlier this month, it announced that an additional 1,400 people will be let go at its North American facilities. By the end of December more than 9,000 employees will be gone in total, according to Gibara.
In addition, "we will continue to reduce inventory during the fourth quarter."
Gibara is pleased with Goodyear's inventory reduction efforts so far. "We have in place a much better process now, so we can respond to changing markets more quickly."