Goodyear bounces to profit as performance ‘exceeds industry’

Akron, Ohio – Goodyear Tire & Rubber Co. has seen a strong rebound in second quarter and first half results with operating income swinging to black for the periods.

The company reported segment operating income of $299 million (€254 million) in the second quarter, up $730 million from a loss of $431 million last year.

“Merger-adjusted” segment operating income, following the acquisition of Cooper in June, stood at $349 million, Goodyear reported 6 Aug.

Second-quarter sales were up 86% at $4.0 billion, driven by higher volume, the Cooper Tire merger, increased sales from other tire-related businesses and favourable foreign currency translation, Goodyear said.

Tire unit volumes totaled 37.5 million, up 84% from the prior year’s period. 

Here, Goodyear said, the impact of the Covid-19 pandemic on industry demand moderated “significantly” relative to last year. 

Replacement tire volume 'continued to exceed industry' with a 78% increase, reflecting both industry recovery and market share gains. 

Original equipment unit volume increased 109%, driven by higher vehicle production and increased market share.  

Volume growth also benefited from the Cooper Tire merger, which closed on 7 June.

“We delivered merger-adjusted segment operating income significantly above last year and nearly 60% higher than second quarter 2019,” said chairman and CEO Richard Kramer.

The results, he said, reflect “continued recovery in demand”, including "above-market growth" across many of Goodyear businesses. 

“Broad economic recovery remains robust, particularly in the US and China,” continued Kramer. 

“The addition of Cooper Tire in early June also contributed to our strong merger-adjusted earnings growth, and we welcome all of our new colleagues to the Goodyear family,” he added.

For the first half of the year, Goodyear’s sales rose 44% year-on-year to $7.5 billion, primarily due to higher volume, the Cooper Tire merger, increased sales from other tire-related businesses and favourable foreign currency translation. 

Tire unit volumes totaled 72.5 million, up 40% from 2020. 

The company reported segment operating income of $525 million for the first six months of the year, up $1.0 billion from a year ago. The company also reported merger-adjusted segment operating income of $575 million.