New York--Goodyear unveiled on Friday a plan that includes the closure of plants and addresses in on the tyre maker's current and future turnaround strategy.
The company intends to close an undisclosed number of factories, reduce its cost structure, accelerate the introduction of consumer-driven new tyres and generate capital to support further investment in the firm's core tyre businesses.
Goodyear has achieved many of its goals in the last three years, Chairman and CEO Robert Keegan said in a news release, and want to further improve its performance as it moves to the next stage of its turnaround.
During the next three years, the company expects to incur restructuring charges of about $150 million to reduce its high-cost manufacturing capacity by 8-12 percent, resulting in anticipated savings of between $100 million and $150 million annually, the company said. Overall, its goal is to improve its segment operating margin by 8 percent and improve the North American Tire business' margin by 5 percent.
Goodyear did not disclose how many facilities will be closed or give their locations. But it did say plant closures will be a key component in its plan. The company noted that high-cost plants will be among the first to be closed.
The firm placed its Engineered Products business on the market Sept. 21, labeling it a non-core operation. Earlier this year, it sold its Wingtack adhesive resins business and its rubber plantation in Indonesia. The sale of its North American farm tyre business to Titan International Inc. is pending.
From Rubber & Plastics News (A Crain publication)