NEW YORK (Sept. 23)—Goodyear is expected to unveil at an investors' meeting today a plan that includes the closure of plants and zeros in on the tire maker´s current and future turnaround strategy.
The company said the plan calls for it to close an undisclosed number of factories, reduce its cost structure, accelerate the introduction of consumer-driven new tires and generate capital to support further investment in the firm´s core tire businesses.
Goodyear has achieved many of its goals in the last three years, Chairman and CEO Robert J. Keegan said in a news release, and want to further improve its performance as it moves to the next stage of its turnaround.
During the next three years, the company expects to incur restructuring charges of about $150 million to reduce its high-cost manufacturing capacity by 8-12 percent, resulting in anticipated savings of between $100 million and $150 million annually, the company said. Overall, its goal is to improve its segment operating margin by 8 percent and improve the North American Tire business´ margin by 5 percent.
Goodyear did not disclose how many facilities will be closed or give their locations. But it did say plant closures will be a key component in its plan.
The firm placed its Engineered Products business on the market Sept. 21, labeling it a non-core operation. Earlier this year, it sold its Wingtack adhesive resins business and its rubber plantation in Indonesia. The sale of its North American farm tire business to Titan International Inc. is pending.