At its annual shareholder meeting yesterday, Goodyear Tire & Rubber declared a dividend of US$0.06 per share of common stock (payable June 1 2015 to shareholders of record on May 1 2015), and shareholders re-elected 13 of the company’s Board of Directors to new one-year terms. Goodyear chairman and chief executive officer Richard Kramer also reviewed the tyre maker’s performance in 2014.
Goodyear Tire & Rubber has announced the establishment of the company’s first research and development facility in China. The new R&D centre is located at the tyre maker’s Pulandian plant in Liaoning Province and will focus on product customisation for original equipment fitments and project support services, supplementing the core tyre technology development that takes place in Goodyear’s global innovation centres in Akron (Ohio, US) and Colmar-Berg (Luxembourg). Goodyear says the facility in China will shorten the time taken to develop high-value-added tyres, particularly for China-based vehicle manufacturers.
Although sales were down 5.2 per cent last year, Goodyear Tire & Rubber was nevertheless able to report record operating profit in 2014. Sales of US$18.1 billion for the year were impacted by $571 million in unfavourable foreign currency translation. Tyre unit volumes totalled 162 million, slightly lower than the 162.3 million recorded in 2013, with original equipment volumes down three per cent and replacement market tyre shipments up one per cent.
Richard J. Kramer, chairman and CEO of Goodyear Tire and Rubber, will discuss current and emerging trends shaping the global tyre and rubber industries with delegates at the upcoming World Rubber Summit, which will take place alongside Tyrexpo Asia in Singapore on 24 and 25 March.
As of 2 February, John T. Lucas will succeed Joseph B. Ruocco as Goodyear Tire & Rubber’s chief human resources officer, and will be appointed a senior vice-president of the company. He comes to Goodyear from Lockheed Martin Corporation, where he served as senior vice-president of human resources and communications.
The Goodyear Tire & Rubber Company’s global headquarters building in Akron has earned a Leadership in Energy & Environmental Design (LEED) Gold rating from the US Green Building Council. At 639,000 square feet, it is among the largest LEED Gold certified buildings in Ohio. The LEED green building program ensures buildings conserve energy, water and other resources and are safer and healthier for occupants. Gold certification indicates Goodyear’s high level of investment in best-in-class building strategies and practices.
Shares in Goodyear Tire & Rubber fell up to 8.7 per cent yesterday after the company reported second quarter net sales that were US$40 million below estimates. Prices tumbled to a daily low of $25.07 as Goodyear announced it achieved March to June quarter net sales of $4,656 million, 4.9 per cent lower than in the corresponding quarter a year ago.
The shortlist of locations for Goodyear’s new factory in the Americas is said to include Brazil, Columbia, Mexico and the US. It goes without saying that numerous factors will be weighed up before a final decision is reached, and we can expect regional councils and development agencies to try and make their local area as attractive to Goodyear as possible. Authorities in the tyre maker’s hometown have been the first to officially show their interest.
Due to a strong free cash flow in 2013, Goodyear Tire & Rubber is reallocating approximately US$1.1 billion of its 2014-2016 cash flow – $300 million of this will go towards establishing a new consumer tyre facility in the Americas. Goodyear aims for the plant to begin production in the first half of 2017 with an annual capacity of around six million tyres, an amount that will be expandable as demand increases. Site selection to identify a suitable location for serving North and Latin American customers is now underway. Total plant investment will be in the vicinity of $500 million.