Akron, Ohio – Goodyear is on track to restore margins in Europe, Middle East & Africa, CEO Rich Kramer said on the back of some encouraging fourth-quarter results in the region.
Net sales in EMEA rose 11.7% year-on-year to $1,264 million (€1012 million), while operating income came in 14.8% higher at $93 million. The fourth quarter gains edged Goodyear’s margins up to 7.4, from 7.2% a year ago.
Among the highlights, said Goodyear, was a 2% rise in consumer replacement volumes and above-market growth in sales of winter and summer tires with rim sizes above 17-inches.
The higher profits, said Kramer, came despite raw material ‘headwinds,’ as the company outperformed the EMEA market, particularly in terms of sales of larger rim sizes.
“We are seeing margin improvement in growth in replacement volumes driven by our award-winning product offerings across the region,“ he also reported.
The CEO went on to highlight Goodyear’s moves to exit declining market segments in EMEA in 2017, including the closure of its Philippsburg, Germany facility in the third quarter.
As a result, Goodyear now expects its consumer replacement tire business to outscore the market in terms of unit-volume growth and mix in the larger rim size segments.
“EMEA is in the middle innings of realigning its go to market model across the region to strengthen its value proposition,” said Kramer.
“This initiative is about creating a sustainable competitive advantage through executing a connected business model to make the tire buying process easier for customers and consumers,” he added.
Over the long-term, the CEO said Goodyear’s EMEA’s “recalibration would strengthen and further differentiate our value proposition through our distribution and service network.
“We are looking forward to the continued execution of EMEA’s strategic plan with a focus on returning the region to its historical margin performance.”