Goodyear signals restructuring plan in the US

Akron, Ohio – Goodyear Tire & Rubber is studying a plan to restructure its US operations in a bid to improve business competitiveness, according to chief financial officer Darren Wells.

“We are working on a significant restructuring plan to reduce low-value. high-cost capacity in the US,” Wells said in a 26 July conference call.*

The move will bring about savings “at least as high as the actions in Germany,” said Wells, referring to a reorganisation programme announced in Germany in March.

Goodyear Dunlop Tires Germany plans to upgrade its tire production facilities in Hanau and Fulda, with an expected 1,100 job cuts at the sites.

There, the company aims to up annual production of 17"-and-over tires by 2.5 million units, while reducing capacity for smaller, less profitable tires at both plants.

The German restructuring, noted Wells, will improve earnings by $60-70 million on completion, with the full benefit expected by 2022.

Commenting on the US rejig, Wells said company officials “feel good about the track record we have, delivering these kinds of initiatives and the savings associated with them.”

However, he went on to say, “there is inevitably some uncertainty in timing, given the steps we have to take prior to announcing something.”

*Comments in transcript sourced from Seeking Alpha.