Standard & Poor's Ratings Services lowered Goodyear's corporate credit rating on Dec. 24.
Goodyear's debt rating was dropped by S&P to ``BB-'' from ``BB+.'' The ratings service also lowered Goodyear's $1.3 billion senior bank facility and other senior unsecured debt rating to ``BB-'' from ``BB+.'' All ratings on the company were removed from CreditWatch, where they were placed Oct. 31, S&P said. The outlook is now negative.
S&P said the ratings reflect its concerns regarding Goodyear's execution of its plan to improve profitability in its North American tire operation.
Robert J. Keegan, Goodyear president, CEO and chief operating officer, said the company is disappointed in the S&P decision.
``While we understand their assessment that we need to improve our operating and financial performance, we already have a plan in place to achieve these objectives,'' he said.
Mr. Keegan acknowledged that Goodyear's North American Tire business ``clearly faces several challenges, and we have already taken decisive action to regain momentum in the market. We are also improving our operational performance, including ongoing cost-cutting efforts and the implementation of successful initiatives that have worked well in our six other divisions. These initiatives are being spearheaded by the new president of North American Tire whose track record includes the turnaround of our chemicals business,'' he said, referring to Jonathan C. Rich.
S&P said Goodyear's debt as of Sept. 30, 2002, was about $5 billion.