Goodyear ‘Disappointed’ in Standard & Poor’s CreditWatch Decision
Goodyear Tire & Rubber has expressed its disappointment at Standard & Poor’s Ratings Services’ (S&P) decision to place the tyremaker’s credit ratings on CreditWatch with negative implications. The company was one of more than a dozen automotive industry-related firms to be added to the list due to their significant exposure to automakers General Motors, Ford and Chrysler.
“We’re disappointed in Standard & Poor’s action,” said Darren R. Wells, Goodyear’s executive vice president and chief financial officer. “There are fundamental differences between our business and the companies whose businesses are heavily tied to the Michigan-based auto manufacturers.
Other companies singled out by Standard & Poor’s included ArvinMeritor, BorgWarner, Cooper-Standard Automotive, Federal-Mogul Corporation, Hayes Lemmerz International, Johnson Controls, Lear Corporation, MetoKote Corporation, Shiloh Industries, Stoneridge, Tenneco and Visteon Corporation.
“Of approximately $20 billion in total sales in 2007, less than 8 per cent was with the global operations of the three Michigan-based automakers,” Wells added. “This number will be lower given weak OE volumes in 2008. Our OE customers are important to us, but more than 80 per cent of our sales are to the replacement market for consumers who already have vehicles.”
Wells added that the near-term impact of financial challenges among the Michigan-based automakers is not expected to be material to Goodyear’s liquidity.