AKRON (June 19, 2002) – Despite less-than-promising shipment data in May, Goodyear is raising its second-quarter earnings forecast to a range of 10 to 15 cents a share from an earlier projection of 5 to 10 cents.
Goodyear is basing its higher forecast on the success of ongoing cost-reduction initiatives and improved results from international operations.
In North America, Goodyear's shipments of replacement tires continued to lag behind the industry's pace in May, although shipments to original equipment customers showed signs of life.
In May, industry shipments of passenger and light truck tires to replacement market customers were down 4 percent from last May, while Goodyear's shipments were off even more although the tire maker did not say by how much. In commercial tires, industry-wide replacement shipments were off 3 percent, and Goodyear's were down more than that.
Compounding the problem for Goodyear is the fact that purchases by its larger wholesalers, while improving, have not returned to 2001 levels, resulting in a less favorable brand and product mix, the company said.
Industry-wide, shipments to OE customers were up 1 percent for consumer tires and 14 percent for commercial tires, Goodyear said. The latter was up so much because vehicle makers have increased their build rates ahead of pending regulation changes. Goodyear´s OE unit shipments were better than the industry for consumer tires but below the industry for commercial tires.
Elsewhere, shipments in the European Union were down more than the 6-percent industry decline, and sales also were down in Latin America and Asia.