...| Case B | Goodyear Tire and Rubber Company | Case B | Goodyear Tire and Rubber Company | II-1. FORMULATION OF THE PROBLEM AREA Goodyear and Rubber Company wees in 1989 een aanbod van Sears af om hun populaire Eagle Brand tire te verkopen binnen hun zaken. Het bedrijf leed in 1990 een verlies van 38 miljoen, na het aanstellen van een nieuw management top binnen het bedrijf in 1991 wordt het aanbod van Sears heroverwogen in 1992. II- 2. EXTERNAL SITUATION ANALYSIS In deze case gaat het om de bandenindustrie. Het is een wereldwijde markt en de deelnemende bedrijven ontwerpen, produceren en adverteren hun producten dan ook op wereldwijd niveau. De totale markt bedroeg in 1991 ongeveer 850 miljoen banden waarvan 29 procent werd geproduceerd in Noord-Amerika, 28 procent in Azië en 23 procent in West-Europa. Er zijn tien bandenproducenten die samen 75 procent van de wereldproductie produceren. De drie grootste bedrijven op de markt hebben samen bijna een marktaandeel van 60 procent van de totale markt. Groupe Michelin (met het hoofdkwartier in Frankrijk) is de grootste en verkoopt de merken Michelin, Uniroyal en BF Goodrich brands. Goodyear is de op een na grootste en verkoopt onder andere de merken Goodyear, Kelly-Springfield, Lee en Douglas. Het derde grootste bedrijf is een Japans bedrijf, Bridge-stone Corporation, welke met name de merken Bridgestone en Firestone verkoopt. De bandenindustrie is onderverdeeld in twee marktsegmenten, namelijk de ‘original equipment...
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...Statement Analysis Project Goodyear Tire& Rubber (GT) *Official Logo copied from (Goodyear Tire & Rubber Company official website, 2013) Corporate Name The Goodyear Tire & Rubber Company Exchange Traded In National Association of Securities Dealers Automated Quotations (NASDAQ) Ticker Symbol GT Description The Goodyear Tire & Rubber Company has a long journey of success of more than a century. Frank A. Seiberling, the founder bought first plant of the company, when the bicycle boom was spreading out around the world. The Goodyear Tire & Rubber Company was initially incorporated with a capital stock of $ 100,000, on August 29, 1928. (Goodyear Tire & Rubber Company official website, 2013) "More people ride on Goodyear tires than on any other kind" was adopted, as the slogan of the company in 1916 and 10 years later in 1926, The Goodyear Tire & Rubber Company became the largest rubber company in the world. (Goodyear Tire & Rubber Company official website, 2013) Goodyear Tire & Rubber Company took a long 53 years to reach the milestone of billion-dollar-year. At present, sales of Goodyear Tire & Rubber Company has a figure in $20 billion. (Goodyear Tire & Rubber Company official website, 2013) *Official Logo copied from (Cooper Tire & Rubber Company official website, 2013) Corporate Name Cooper Tire & Rubber Co Exchange Traded In New York Stock Exchange (NYSE) Ticker Symbol CTB Description The history of Cooper Tire Company actually dates back to 1914...
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... 2014 The Goodyear Tire and Rubber Company was founded in 1898 by F. A. Seiberlingin Akron, OH. Goodyear specializes in the design, manufacture and distribution of tires for automotive and industrial applications. They operate 60 plants in 26countries for distribution to 185 countries around the globe ("Goodyear.com", 2013). Revenues are generated through five operating units based on geographic regions North America, Latin America, European Union, Asia Pacific, and Eastern Europe (which includes the Middle East and Africa). From the North American segment, Goodyear had strong performance of $514 million for a full-year’s earnings beating the company’s target of $450 million. Goodyear was able to deliver record earnings despite a nearly half-billion dollar lost $305 million in 2009 ("Goodyear.com", 2013). Goodyear Tire and Rubber Company has gone through great change in the past years, barely skirting bankruptcy as it dealt with recession, labor difficulties and changing demand in the tire market. Avoiding default by mere days, it has rebounded to become a “buy” in most analysts portfolios. Goodyear began its transformation by realizing the growth market for tires was moving away from the commodity-based low margin tires it had featured to higher margin differentiated tires for targeted markets. The strategy requires Goodyear be less leveraged and more equity financed as the risk of selling differentiated tires is greater than that of cheaper commodity tires. Goodyear’s excessive...
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...Case Analysis Goodyear Tire and Rubber Company Submitted by: Rick Fletcher MB545 Marketing Management City University, Renton MBA 2000 Program Fall Quarter, 1999 Introduction The Goodyear Tire and Rubber Company is currently the #1 tire maker in the world[1]. The 101 year-old company has maintained that position through most of the company's history. However, in the early 1990's Goodyear slipped to #3 as France's Michelin and Japan's Bridgestone found better ways to get their products to consumers. To regain their #1 status, Goodyear was forced to re-think their century-old practice of marketing their product exclusively through its dealer network. Problem Definition Goodyear is facing tough competition from tire companies that focus their attention on the replacement tire market rather than the new car market. Also, their competitors do not rely solely on dealer networks to distribute their product. To respond to these challenges, Goodyear decided to focus on the replacement tire market and to sell tires through Sears, Wal-Mart, Discount Tire, and other discount stores in addition to their traditional franchise stores. The decision to sell tires through discount stores created some problems for Goodyear: • Allowing tire franchises and multibrand discount stores to sell Goodyear tires upset Goodyear dealers because it drastically increased competition. • Multibrand outlets may lure customers...
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...MEMORANDUM The Goodyear Tire & Rubber Co 200 Innovation Way Akron, Ohio , 44316-0001 phone: (330) 796-2121 Fax: (330) 796-2222 Date: August 05, 2013 To: Mr. Zilverstein, Head of Business Development From: Noam Hadass, Senior Analyst Subject: Analysis - Goodyear Tire & Rubber Co. Dear Mr. Zilverstein , please find below as you requested: * SWOT analysis on the company * an issue that we believe will affect the company in the future * A visual for Goodyear’s revenue in the years 2010-2012. SWOT ANALYSIS Strength: * Loyal customers: When given a choice, customers are loyal to Goodyear Tires. Instead of targeting all customers, Goodyear Tires can invest most of its resources on new customers and only a small portion on the preservation of existing ones. Weakness: * 19th largest air polluter in the U.S: the manufacturing process of Goodyear tire is ineffective regarding the amount of pollution it creates. And as the world is advancing towards “Green” manufacturing in all sectors, being a major polluter can affect the positive corporate image Goodyear are trying to create. Also this makes the company sensitive to regulation towards pollution. Opportunity: * Penetrate new markets in China and India: right to this day Goodyear has a very little market share in these developing countries. With about a third of the world’s population, this market represents an opportunity for large growth...
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...Goodyear Tire and Rubber Company Goodyear is one of the world's leading tire companies. This strategic plan for Goodyear will focus on their passenger vehicle. The plan will focus on ways to strengthen the internal and external methods to ensure that products remain at the best they can be for consumers. In doing this, we will concentrate on pricing, product placement, positioning, and most importantly promotion. Promotion has continued to drive the business and this plan will focus on it continuing to do so for years to come. Company Background & Milestones: It all began in 1898. Goodyear’s founder, Frank A. Seiberling, purchased the company’s first plant with a $3,500 down payment. With just 13 employees, Goodyear production began with a product line of bicycle and carriage tires, and horseshoe pads. Since the first bicycle tire in 1898, Goodyear pedaled its way toward becoming the world’s largest tire company, a title it earned in 1916 when it adopted the slogan "More people ride on Goodyear tires than on any other kind," becoming the world’s largest rubber company in 1926. Today, Goodyear measures sales of nearly $20 billion. Goodyear is currently the No. 1 tiremaker in North America and Latin America. Goodyear is also Europe's second largest tiremaker. In 2011, Goodyear posted net sales of $22.8 billion, up 21% over 2010. Net income available to common shareholders was $321 million in 2011. Goodyear operates 53 plants in 22 countries. Together with its subsidiaries...
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...Good Year Tire and Rubber Company Case Analysis Background Goodyear Tire and Rubber Company is a profitable business which was founded in 1898. When 38 year old Frank Seiberling purchased the company he knew nothing on the longevity and success it would bring. Mr. Seiberling installed a down payment on the first Goodyear plant with a borrowed amount of $3500.During the late 1800s and early 1900s cotton and rubber were considered the lifeblood of the industry. At the time of Goodyear’s founding the existence of bicycles was fresh and business was booming at an increasing rate. With faith and the determination of 13 employees Goodyear’s initial production line consisted of bicycle and carriage tires, horseshoe pads and poker chips. With now a new need for bicycle tires being a demand for consumers Goodyear carved its mark in history as the world’s largest tire company in 1916. Strategic Issues and Problems In early 1992 Goodyear began to consider a previously declined proposal of Sears. This previously declined proposal now would benefit Goodyear because the company suffered a loss of $38 million. Good year’s market share and customer retention are both decreasing and this is becoming the overarching problem for the company. The factors to consider before making a decision on the sears proposal at hand are: 1. Goodyear brand tires reportedly declined in market share by 3.2% 2. About 2 million used or worn out Goodyear tires were being replaced at sear automotive...
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...University Assignment M8A1 This research paper is focus on Goodyear Tire and Rubber Company (Goodyear). The objective of this research paper is to determine if Goodyear should expand to Vietnam as a Foreign Direct Investment (FDI) or not. The research will focus on these areas: 1) Goodyear Financial 2) History of Goodyear 3) Principal of Business 4) The Country Vietnam a. History b. Economy d. Trade and Balance of Payments g. Intellectual property rights h. Work forces i. Currency exchange rate 5) Conclusion Goodyear is a US based company, which is traded on the New York Stock Exchange (symbol GT). They have more than 20,000 investors and employ about 72,000 people around the world. They are one of the world’s leading tire companies and second largest tire manufacturer in Europe behind Michelin. They have 55 plants in 22 countries and operate in most regions of the world. Goodyear Tire and Rubber Company was founded by Frank A. Seiberling in 1898. During the early stages of the company, rubber and cotton were the lifeblood of the organization. The wingfoot trademark of Goodyear was not known to the public until it was first advertised in 1901. In 1905, four years after Goodyear first advertised, they emerged into a tire manufacturer leader. In 1910, Goodyear became a multi-national company when it acquired foreign plant in Bowmanville, Ontario, Canada and opened sales...
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... DEMORANVILLE GOODYEAR TIRE AND RUBBER CASE THE MARKET The global tire industry is not highly saturated and is dominated by key players who have a substantial share of the market in every region worldwide. It is divided into two segments: the original equipment tires which are sold directly to automobile manufacturers and the replacement tire market which are sold to private car owners looking to replace old tires. Key players in the tire industry have retained majority market share in both industries despite the difference in consumer behavior and buyer specifications between each market. Some of these key players include: Michelin, Goodyear and Bridgestone which collectively account for about 60% of sales. About 30% of industry volume is dedicated to original equipment tires of which Goodyear is the market leader with 38% of that total market. Although a majority of tires sold are in the tire replacement industry, tire producers unable to gain a majority share in that market consider that end consumers may stay brand loyal to the original tire brand that came with their car at time of purchase. Price competition amongst tire manufactures in this market is tight and it also yields less margins than the tire replacement industry. The replacement tire industry accounts for about 70-75% of total tire industry sales and so it is crucial that tire manufacturers hold relevant market share in this market in order to stay competitive. Major players in the tire industry are threatened...
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...ECON 2010 11 November 2012 Chinese tire tariff lifted September 2009 marked the beginning of a major tariff on imported Chinese tires created by President Obama in an effort to curtail imports considered to possibly be a detriment to U.S. workers. This motion was brought to the table by a complaint filed to the Federal Trade Commission by the United Steelworkers union citing unfair trade practices by China1. The belief was that cheap, imported Chinese tires were the root cause of the loss of over a thousand U.S. jobs in tire manufacturing. Many believe that the tariff was political posturing from Obama aimed at the ever critical Ohio automotive unions. Politics aside, the economic impact over the last 3 years has been great, or not so great, depending on which side of the fence you are standing. Import tariffs by design are used to help control trade balances with foreign countries in an effort to create a somewhat level playing field for all firms within an industry. The Chinese tire tariff has arguably been an irrelevant political attempt to bolster the support of union labor in Ohio. Beginning as early as 2000 the United States had approximately 87,000 workers domestically in tire manufacturing with that number shrinking each year down to 55,000 in 20093. As with much of domestic manufacturing, tire companies began to look to foreign countries to produce their products due to lower costs and higher volume capabilities. With approximately 46.5 million imported...
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...The Goodyear Tire & Rubber Company (Goodyear) was founded in 1898 by Frank Seiberling, with a $3500 down payment. According to Goodyear’s website, they began production with just 13 employees, starting with a line of carriage tires, horseshoe pads, poker chips and bicycle tires. The first month of sales generated just over $8,000 – and nearly 120 years later, their sales exceed $20 billion. To accomplish this growth and success, Goodyear has continued to evaluate their products and services; continuously focused on driving out inefficiencies; reduced unnecessary overhead expenses; and operated on a core set of values to remain an effective organization. Goodyear’s Mission is: “Constant improvement in our products and services to exceed the expectations of our customers and people.” Goodyear’s vision is: “Become a market-focused tire company providing superior products and services to end-users and to our channel partners, leading to superior returns for our shareholders.” (The Goodyear Tire & Rubber Company website). The Goodyear brand,brand and heritage Wingfoot Symbol is recognized in nearly every corner of earth. The wingfootWingfoot symbol was created by the original founder Frank Seiberling, who drew the idea from a statue in his home of the Greek God, Hermes. Frank felt the god portrayed the characteristics and values that were representative of Goodyear. The symbol also led to one of the biggest initiatives in Goodyear history – the wingfootWingfoot express. ...
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...American company International sales Generally increasing sales revenue since 1991 Brand recognition Brand loyalty Reduction in debt since 1991 Introduction of new tire lines The Blimp P/E ratio The world’s No. 1 tire manufacturer Patents: 2,903 Trademarks: 5 WEAKNESSES Size Declining stock price Internet sales Dealer contracts that my be inhibiting Internet sales Layoffs Sales declines in Europe, Asia, Latin America OPPORTUNITIES New international markets: China, India, Russia New international markets: Internet sales R&D expenditures\innovations THREATS Competition: Internet sales Wholesale club stores (tire sales) Bridgestone Cooper Continental Michelin Pep Boys (auto service stores) Midas (auto service stores) Auto Zone (auto service stores) Independents OVERVIEW OF STRENGTHS Size still matters and Goodyear has size. Its 1999 sales were $12,881,000,000 representing a one-year sales growth of 2%. Its net income was $241,000,000, a lot of money but a decrease of 64.7% from one year earlier. Despite that drop in net income, Goodyear paid a $.30 dividend. Its net income also beat Wall Street’s expectations. It has become the world leader in tire sales as a result of its alliance with Japan’s Sumitomo Rubber Industries. Goodyear ranks No. 130 in Fortune Magazine’s 500 list of large companies. Its product diversity includes the manufacture and sale of tires, industrial and consumer products from rubber including belts, hoses, and tank tracks, and a wide range of synthetic rubber, resins...
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...Goodyear Tire and Rubber Company – Case Analysis 1. Introduction/Background: Goodyear Tire and Rubber Company, headquartered in Akron, Ohio, was founded by Frank and Charles Seiberling in 1898. Goodyear’s principal business is the development, manufacture, distribution and sale of tires throughout the world. In addition to Goodyear brands tires, the company owns the Kelly-Springfield Tire Company, Lee Tire and Rubber Company, Delta Tire and they manufacture private-label tires. Goodyear was the world leader in tire production until November, 1990, when Groupe Michelin acquired the Uniroyal Goodrich Tire Company. Goodyear controls 20 to 25 percent of the world’s tire manufacturing capacity and about 37 percent of the U.S. tire-making capacity. The Goodyear brand is the market share leader in North America and Latin America, number two in Asia outside Japan behind Bridgestone, and third in market share in Europe behind Michelin and Pirelli. World tire production in 1991 was approximately 850 million tires, of which 29 percent were produced in North America, 28 percent in Asia, and 23 percent in Western Europe. Ten tire manufacturers’ account for 75 percent of worldwide production. The three largest tire manufacturers account for almost 60 percent of all tires sold worldwide. Groupe Michelin, headquartered in France, is the world’s largest producer, Goodyear is the second-largest producer and Bridgestone Corporation, a Japanese firm, is the third-largest tire producer...
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...Goodyear Financial Analysis Writing Assignment: Financial Analysis Assume you are a savvy financial analyst researching companies in which to invest. Select a U.S. publically-traded company you think might be a good investment and perform a financial analysis. FIN 534: Financial Management - Quarter (Winter 2013) Professor: March 12, 2013 Goodyear Financial Analysis Company Overview The Goodyear Tire & Rubber Company a leading manufacturer of tires is one of the best in the world and one of the most recognizable brand names in the world (Edgar). Goodyear has operations in most regions of the world with 52 manufacturing facilities in 22 countries, including the United States (Edgar). Goodyear regional tire businessesconsists of the following four segments: North American Tire; Europe, Middle East and Africa Tire; Latin American Tire; and Asia Pacific Tire (Edgar). Despite the conditions in 2012 Goodyear has done fairly well in the continued weak industry conditions (Edgar). The economic recovery in the developed markets and the uncertainty surrounding debt and other fiscal policy issues in Europe and the U. S. and along with continued high levels of unemployment, all have contributed to a negative impact on overall economic conditions and customer and consumer confidence. Goodyear tire unit shipments in 2012 only decreased 9.2% compared to 2011, primarily as a result of continued weakness in Europe (Edgar). In addition...
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...Summary: In early 1992, Goodyear Tire and Rubber Company executives were reconsidering a proposal from Sears, Roebuck & Company that was originally made in 1989. The proposal from Sears was for Goodyear to sell its popular Eagle brand tires through 850 Sears Auto Centers in the U.S. This proposal was declined in 1989 because Goodyear management felt that selling their tires through a mass merchandiser such as Sears would undermine the tire sales of company owned Goodyear Auto Service Centers and franchised Goodyear Tire Dealers. However, following a $38 million loss in 1990 and a change in Goodyear top management in 1991, the Sears proposal resurfaced. Two factors apparently prompted Goodyear’s renewed interest in the Sears proposal. First, the Goodyear brand passenger car replacement tire market share in the US had a 3.2 percent decline between the years 1987 and 1991. This share decline represented a loss of about 4.9 million tire units. Second, Goodyear executives believed that nearly 2 million worn out Goodyear brand original equipment tires were being replaced annually at some 850 Sears Auto centers. Goodyear executives believed the failure to repurchase Goodyear brand tires happened by default because Sears customers had such a remarkable loyalty to the company they were led to buy the best tire available that Sears had to offer, which did not include Goodyear brand tires. Problem: Primary: Goodyear’s primary problem lies within their current distribution...
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