Goodyear grows earnings despite setbacks in Europe, Asia

Akron, Ohio – Goodyear Tire & Rubber Co. has reported a strong start to 2022, helped by its acquisition of Cooper Tire & Rubber in June last year.

The US group posted a 33% year-on-year growth in segment operating income to $303 million (€286 million), on 40% higher sales of $4.91 billion, Goodyear announced 6 May.

Adjusted for merger with Cooper Tire, segment operating income rose 38% to $311 million.

“We delivered our highest first quarter revenue in 10 years despite ongoing supply chain disruptions, impacts from geopolitical issues in Europe and increasing Covid-19 restrictions in China,” said chairman, president and CEO Richard Kramer.

Goodyear linked the increase in sales to the acquisition of Cooper Tire, improvements in price/mix, higher volume, and increased sales from other tire-related businesses.

Earnings were up due to “strong pricing actions” across key markets, Goodyear added.

Tire unit volumes totalled 45.0 million, up 29% from the prior year's period.

Replacement and original equipment tire unit volume increased 35% and 9%, respectively, reflecting the addition of Cooper Tire unit volume and market share gains.

Breaking down the regions, Goodyear posted a strong performance in Americas with first quarter sales up 63% at $2.9 billion.

This, it said, was mainly driven by the Cooper Tire merger, improvements in price/mix, and increased sales from other tire-related businesses.

Tire unit volume increased 44% in the region, reflecting a 55% increase in replacement volume and 5% rise in OEM sales.

First quarter segment operating income of $216 million was up $102 million from the prior year's quarter.

In Europe, Middle East and Africa, the group reported a 16% increase in sales to $1.4 billion, due to improvements in price/mix, a 14% higher volume and the Cooper Tire merger.

Segment operating income, however, was down 20% year-on-year at $59 million.

Goodyear linked the decline to higher raw material costs, inflationary cost pressures in energy, wages, benefits and transportation, and adverse foreign exchange.

These factors were partially offset by improvements in price/mix and the impact of higher volume.

In Asia Pacific, Goodyear saw sales rise 15% to $567 million, driven by the Cooper Tire merger, and a 21% increase in volume.

Segment operating income fell 26% to $28 million driven by higher raw material costs, partly offset by improvements in price/mix, the Cooper Tire merger and higher volume.