The company said it expects its operating income to increase 20% to 25% year over year against sales of around $20 billion.

However, Goodyear said its fourth quarter operating income will be flat against 2004 results as cost cutting could not offset a 13% rise in raw material costs.

"Our strong 2005 results show the impact of Goodyear’s innovative new products around the world and improved marketing give us a solid foundation for the next stage of our turnaround," said Robert Keegan, chairman and CEO.

"We are working worldwide to reduce our costs and working capital needs, as well as to further improve our product and brand mix," Keegan added. "Nevertheless, the escalating cost of raw materials and currency fluctuations continue to challenge our businesses."