AKRON, Ohio, April 7, 2009 – In his address at The Goodyear Tire & Rubber Company’s 2009 Annual Shareholder Meeting today, Chairman and Chief Executive Officer Robert J. Keegan said he remains confident in Goodyear’s ability to drive performance during challenging economic conditions and emerge in a position of competitive strength.
This confidence, he said, derives from Goodyear’s “game tested” leadership team, a proven track record based on strong strategies and continued new product success, as well as actions the company is taking to improve its cost structure and strengthen its cash position.
“It is very clear to us that given the challenging 2009 economic environment, our intense focus on the Seven Strategic Drivers remains a solid strategic foundation,” Keegan said.
“As we address our market challenges head-on, we are not creating a new path. Rather we will be taking a proven path to the next level.”
Keegan identified three specific areas that he said will keep the company on its path toward success. These are:
• Top line – encompassing new product leadership, building core brand strength and leveraging Goodyear’s industry-leading distribution network;
• Lowering costs – aggressively aligning Goodyear’s cost structure with today’s lower industry volumes; and
• Managing for cash – focusing on the strength of Goodyear’s balance sheet and generating funds to reinvest in the business.
Keegan said his confidence is strengthened by the support of Goodyear’s dealers and their enthusiasm about the company’s global plans to launch more than 50 new products in 2009.
Among these new products is Goodyear’s Assurance Fuel Max tire, which is now available at Goodyear retailers. Assurance Fuel Max provides 27 percent less rolling resistance than the standard Assurance tire. This equates to a 4 percent improvement in highway fuel economy.
“During challenging economic times, new products, strong dealer support and innovative marketing programs will be the core revenue-generating strengths for Goodyear,” Keegan said.
Commenting about the impact economic conditions had on the tire industry and on Goodyear in 2008; Keegan noted the significant decline in industry demand, especially in the fourth quarter.
“However, we should not let the global economic decline overshadow the many positive actions that we took and the results that we achieved in 2008 as we successfully executed against our proven strategies,” he said.
Among the company’s 2008 accomplishments noted by Keegan were:
• Total sales of $19.5 billion, about equal to 2007 despite the economic slowdown;
• An 8 percent increase in revenue per tire;
• Record sales in the Asia-Pacific, Latin America and Europe, Middle East & Africa businesses;
• Replacement market tire sales and other sales unrelated to OE were more than 80 percent of total global sales with sales to “Detroit 3” automakers now less than 7 percent of the total.
• Record segment operating income in the Asia-Pacific and Latin America businesses;
• Goodyear-brand market share gains in major markets; and
• More than $700 million in savings as part of the 4-Point Cost Savings Plan.
Keegan said Goodyear’s goal in 2009 is to reward the confidence and support of its dealers and shareholders by “aggressively positioning Goodyear to weather this economic storm and to seize upon the opportunities when our markets rebound, as they inevitably will.”
Goodyear is one of the world’s largest tire companies. It employs approximately 75,000 people and manufactures its products in more than 60 facilities in 25 countries around the world. For more information about Goodyear, go to www.goodyear.com/corporate.
Certain information contained in this press release may constitute forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. There are a variety of factors, many of which are beyond our control, which affect our operations, performance, business strategy and results and could cause our actual results and experience to differ materially from the assumptions, expectations and objectives expressed in any forward-looking statements. These factors include, but are not limited to: deteriorating economic conditions or an inability to access capital markets; our ability to realize anticipated savings and operational benefits from our cost reduction initiatives or to implement successfully other strategic initiatives; actions and initiatives taken by both current and potential competitors; pension plan funding obligations; increases in the prices paid for raw materials and energy; work stoppages, financial difficulties or supply disruptions at our suppliers or customers; a labor strike, work stoppage or other similar event; our failure to comply with a material covenant in our debt obligations; the adequacy of our capital expenditures; potential adverse consequences of litigation involving the company; as well as the effects of more general factors such as changes in general market, economic or political conditions or in legislation, regulation or public policy. Additional factors are discussed in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. In addition, any forward-looking statements represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our estimates change.