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5. The Goodyear Tire & Rubber Company Business Report FY ended Dec. 2018

The Goodyear Tire & Rubber Company Business Report FY ended Dec. 2018

Factor
1) Net Sales
-The Company’s net sales for the fiscal year ended December 31, 2018 increased by 0.6% over the previous year to EUR 15,475 million.  The increase in sales was driven by an increase in price and product mix, partially offset by unfavorable foreign currency translation, primarily in Americas.

2) Operating Income
-In the fiscal year ended December 31, 2018, the Company’s operating income decreased by 18.1% over the previous year to USD 1,274 million. The decrease in operating income was primarily due to the impact of higher raw material costs, lower income in other tire-related businesses, higher selling, administrative and general expense (“SAG”), unfavorable foreign currency translation, primarily in Americas, and decreases in price and product mix, primarily in Americas. These impacts were partially offset by lower conversion costs. 

Recent Developments

-Announced that it will join research activities of the Mcity public-private research organization led by the University of Michigan. The company will accelerate development of next-generation vehicle tires and tire sensors by conducting electric and autonomous vehicle tests at the Mcity test facility. The test facility offers simulated urban and suburban driving conditions. Mcity has sixty partners including automakers, automotive parts suppliers, semiconductor makers, and insurance companies, which aim to collect data and develop technologies for autonomous driving and intelligent transport systems. Goodyear Tire & Rubber will be the only tire maker partner. The company is focusing on the research and development for autonomous vehicles and ride sharing services. (From an article in the Nikkan Jidosha Shimbun on June 13, 2018)

Contracts

-Goodyear Japan announced that its Eagle F1 Asymmetric SUV high performance tire has been selected as original equipment for Mercedes-Benz's new G-Class "Mercedes-AMG G63", which is scheduled to be released in Japan in autumn 2018. The Eagle F1 Asymmetric SUV is a high performance tire designed to handle the weight of an SUV. Its Active CornerGrip Technology helps to maximise grip and tracking, so that a driver can enjoy the drive. The tire size is 295/40R22 112W. (From a press release on October 23, 2018)
 

Awards

-Announced that it was recognized by Subaru of Indiana Automotive (SIA) with the Excellent Performance Award as an exceptional parts and delivery supplier. The award also distinguished Goodyear for its commitment to achieving excellence in collaboration with SIA. Goodyear has been an original equipment supplier to SIA since 2005, supplying OE tires for the Subaru Tribeca and currently working with Subaru to deliver three fitments for the Subaru Legacy. (From a press release on May 24, 2018)

-Announced that it was recognized by Honda North America with its prestigious Supplier Sustainability Award for demonstrating an exceptional commitment to social and environmental responsibility. Goodyear was Honda’s only North American Original Equipment Supplier to earn this distinction, out of more than 500 suppliers. Goodyear has a long history of working with Honda and has been supplying tires for the automaker for more than 30 years. Some of the most recent original equipment fitments that were awarded to Goodyear include the Honda Accord and Acura RDX and TLX vehicles. (From a press release on May 9, 2018)

Outlook

-For the fiscal year ending December 31, 2019, the Company expects to see benefits from the ramp-up of our new Americas manufacturing facility and TireHub, pricing actions that we implemented in 2018, and continued strong performance in our sales of 17-inch and above consumer replacement tires.

R&D Facilities

-The Company has two innovation centers located in Akron, Ohio, U.S., and Colmar-Berg, Luxembourg, as well as three research and development centers in Hebron, Ohio, U.S.,  Hanau, Germany, and Pulandian, china. The Company also has seven tire proving grounds.

Product Development

Concepts showcased at 2018 Geneva International Motor Show
-Announced that it presented at the 2018 Geneva International Motor Show its EfficientGrip Performance with Electric Drive Technology, a prototype tire for the growing electric vehicle market, that will be on the road by 2019 in Europe. The company introduced also its latest concept tire, named Oxygene, quite literally brings the future of mobility to life as a visionary solution for cleaner, more convenient, safer and more sustainable urban mobility. This tire has a unique structure that features living moss growing within the sidewall. Furthermore, Goodyear showcased the latest advances on its intelligent tire prototype, a complete tire information system that includes a tire, sensors and cloud-based algorithms that all work together to communicate in real-time with fleet operators via a mobile app. (From a press release on March 9, 2018)

Patents

-As of December 31, 2018, the Company owns approximately 1,800 patents issued by the U.S. Patent Office and approximately 3,400 patents issued and granted from other countries. The Company currently has approximately 400 patent applications pending in the U.S., and 1,200 patent applications pending in other countries.

-The Company’s capital expenditures in the fiscal year ended December 31, 2018 were invested primarily in the construction, expansion and modernization of manufacturing capacity in the United States, China, India and Thailand.

Investments outside U.S.

<Slovenia>
-Announced plans to expand its manufacturing facility in Slovenia to meet the growing demand for premium tires in EMEA. It has planned investment of EUR 94 million to increase current capacity by approximately 25%. The investment will add 5,400 square meters to accommodate advanced tire building machines. This will allow for production of an additional 1.8 million premium, A segment consumer tires annually. Production will focus on 17 to 19 inch replacement tires in EMEA. The company expects to create about 160 new positions in Sava, mainly in the production area. The first phase of construction will begin in January 2019, with additional phases planned for 2020 and 2021 to reach full capacity. (From a press release on December 18, 2018)