ERJ staff report (TP)
Akron, Ohio – The Goodyear Tire & Rubber Company today said it plans to invest about $500m (€368m) in a new tire plant in the Americas.
Site selection is underway to identify the best location for the plant to support North America and Latin America customers. Tire production is expected to begin in the first half of 2017.
It will have an initial capacity of about six million tires per year and capacity will be increased as demand increases.
The new tire plant will support Goodyear’s long-term growth in “high-value-added consumer replacement and original equipment market segments”.
The company also announced an update to its 2014-2016 capital allocation plan focused on increasing shareholder returns and capturing high-return growth opportunities in North America and Latin America.
Due to Goodyear’s “strong” 2013 free cash flow, which enabled the full funding of its hourly US pension plans in early 2014, the company is reallocating approximately $1.1bn of its
2014-2016 cash flow.
The updated capital allocation plan will “increase shareholder value by providing approximately $650m in returns to investors, strengthening the balance sheet and investing in high-return growth”.