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Unit Sale Fall-Off Hampers Goodyear 1H Results

After a down second quarter, Goodyear Tire & Rubber Co.’s first half sales results were off by 3% year-over-year and its net operating income fell by $81 million.

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After a down second quarter, Goodyear Tire & Rubber Co.’s first half sales results were off by 3% year-over-year and its net operating income fell by $81 million.

And, according to chairman and CEO Rich Kramer, unit sales aren’t about to get better.

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Driven by lower tire volumes around the world, for the first six months of 2012 Goodyear posted sales of $10.7 billion, down from 2011’s $11 billion. First half operating income came in at $628 million, down $81 million YoY.

Looking forward, for the full year 2012 Goodyear said it anticipates North America consumer replacement tire sales to be off 1%-3%, consumer OE to be up 5%-10%, commercial replacement down 5%-10%, and commercial OE to be up 10%-15%.

For its Europe, Middle East and Africa unit, Goodyear sees consumer replacement down 8%-10%, consumer OE down 5%-10%, commercial replacement down 3%-8%, and commercial OE down 5%-10%.

Through June 30, Goodyear sold 31.2 million tires in North America – OE and replacement – down from 2011’s 32.8 million units. Tire sales for the Europe, Middle East and Africa unit were 32.2 million vs. 36.7 million for 2011’s first half.

"We remain confident that long-term growth in the global tire industry will continue, but at a slower pace near-term than previously forecast due to continued economic challenges, particularly in Europe," Kramer said.
Goodyear now expects that its full-year tire unit volume for 2012 will be approximately 5%-7% below 2011.

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