David Anckaert, vice president, consumer Europe replacement, Goodyear, discusses the effects of the Covid-19 pandemic on business:
ERJ: How would you describe business thus far in 2020?
David Anckaert: As with many other industries, Goodyear’s business was significantly affected by difficult conditions as a result of the ongoing Covid-19 pandemic. We saw a knock-on effect on mobility as governments and authorities across Europe implemented confinement and social distancing measures. With people travelling fewer kilometres, we saw declines both in replacement tire shipments, due to lower consumer demand, as well as Original Equipment unit volume, due to lower demand and reduced vehicle production.
ERJ: What are some of the key changes the company has made in response to the Covid-19 crisis?
DA: We took quick, decisive action to adapt to the situation, ensuring that we closely supported our customers, maintaining the same high levels of service and meeting consumers' current preference for contact-free shopping, all while doing the utmost to help protect the health and well-being of our associates, customers and consumers.
Goodyear’s teams demonstrated real agility in adjusting our offices to a work-from-home model where possible. In the EMEA region, we successfully transitioned to remote working while maintaining productivity levels and without any major service interruptions.
In our manufacturing facilities, we scaled down production, closing all our plants in EMEA. In the second quarter the company completed a phased restart of production. All of the company’s factories resumed production and none have experienced any Covid-19 related disruption following their restart.
As the situation continues to unfold, our focus remains the wellbeing of our associates, servicing our customers and consumers and supporting our brands while appropriately managing our costs and working capital.
ERJ: What positives have you seen at your company and in the wider tire industry over recent months?
DA: I have been particularly inspired by the way that the wider industry, and our teams at Goodyear especially, continue to look for new and innovative ways to enable mobility and support the communities where we operate.
We have been striving to find new ways to work with both consumers and our customers, focusing in particular on contactless solutions.
One example has been the continued roll-out of our European e-commerce solution in select markets, with the launch of a new web platform in Poland in May. This allows consumers to research, shop and schedule tire installation right from their homes.
A number of our markets across Europe have also implemented new digital and online solutions for providing information and training to customers, allowing us to continue building on the strength of our relationships and maintaining our service and support for them.
The past months have also demonstrated the crucial role our industry plays in keeping the world moving, whether it be the transport of critical goods, food and medicine or enabling emergency responders to help save lives.
At Goodyear we have had the unique opportunity and privilege to step in and increase support for our communities, especially health care providers that are critical to supporting those impacted by Covid-19. In some of our key European markets, we were even able to offer free tire servicing for front-line medical personnel.
It has been encouraging to see how this phenomenon has spread throughout our industry as well, as people have contributed what they can to support their communities.
ERJ: What kind of trends are you seeing in the marketplace and how have your company adjusted its product portfolio in response?
DA: Rapid changes in consumer behaviour and evolutions in technology have been taking place for some time in our industry.
Consumers looking for a more convenient tire purchasing experience has not only changed the way tires are sold, accelerating online sales, but it’s also changing the very characteristics they are looking for from their tires.
Consumers are looking to reduce the frequency of their tire changes from a cost, convenience and even sustainability perspective. This has meant significant growth in the All-Season segment as well as the requirement for new products that can deliver more mileage. We are also seeing growth in the light truck segment, itself a direct consequence of the growth in e-commerce and last-mile delivery.
Goodyear is exceptionally well positioned for these evolutions. Our product portfolio includes recent launches such as the EfficientGrip Performance 2 - a high-performance tire that boasts an impressive, estimated 50% higher mileage than its predecessor – as well as the Vector 4Seasons Gen-3, the latest installment in our award-winning range of all-season tires.
Although the Covid-19 pandemic emptied our roads of traffic, as confinements gradually begin to ease, the pace of change is beginning to pick up again.
From a consumer perspective, we are seeing shoppers seek out ways to feel safe while getting the products and services they need through options like online shopping.
As countries across Europe begin to re-open their economies, we may also see a shift in how consumers travel — choosing their own vehicles over public transportation and driving instead of flying.
Goodyear’s focus remains on ensuring that we have the right tires, in the right place at the right time for our consumers. To that end we have been making a series of investments in our business in Europe. This has included an award-winning refresh of the European product portfolio over the last 18 months, a realignment of the company’s distribution network to grow with a dedicated set of partners and the launch of e-commerce options in select European markets.