Goodyear has managed a big turnaround, posting a net profit of USD $70m last year after being deep in the red the year before. A big boost? The “Goodyear Forward” transformation programme.
Chair and CEO Mark Stewart, who took up his post on 29 January 2024, welcomed the progress made during the publication of the .
“As I reflect on my first year at Goodyear,” said Stewart in a statement, “I am pleased with the progress we have made. We exceeded our full year 2024 Goodyear Forward expectations and raised our targets for 2025, grew earnings and segment operating margins across all business units, and successfully reached agreements to divest non-core assets as part of our comprehensive strategic review.”
The return to profit is largely due to the Goodyear Forward programme the CEO mentioned, which the company hopes will generate $1.5bn in annual run-rate benefits by the end of 2025. The programme has three axes:
—expanding margins by raising prices and optimising costs;
—optimising the business portfolio, illustrated by the disposal of non-strategic assets; the sale of the off-road tyre business to the Yokohama Rubber Company was finalised in early 2025, while the sale of the Dunlop brand to Sumitomo Rubber Industries should be completed by mid-year
—reducing debt, with the aim of bringing the net debt ratio down to between 2.0x and 2.5x by the end of 2025
The implementation of this strategy is already bearing fruit, as it has enabled the group to generate profits of $480m in 2024 and to increase its adjusted net profit (a figure that gives a clearer picture of the company’s operating performance) to $302m, compared with $61m the previous year.
Goodyear’s annual sales will thus reach $18.9bn dollars in 2024, with unit tyre volumes totalling $166.6m, says the press release.
Outlook still uncertain
In Europe, the Middle East and Africa (EMEA), sales fell from $5.606bn to $5.425bn, but operating profit for the sector jumped from $17m to $108m year-on-year. In the fourth quarter of 2024, sales in the region reached $1.5bn, up 3.7%.
Despite these encouraging signs, Goodyear remains cautious for 2025. In its statement, the group highlights several risks likely to affect its trajectory, in particular those related to the sale of the Dunlop brand, changes in competition, fluctuations in raw material and energy prices, disruptions in its supply chain, general economic conditions and “labour unrest.”
Goodyear is one of the world’s largest tyre manufacturers. The company employs around 68,000 people and operates 53 factories in 20 countries around the world. The company also has two innovation centres, one in Akron, Ohio (US) and one in Colmar-Berg, Luxembourg.
This article in French.