AKRON—The combined effects of price increase and weak demand impacted Goodyear's first quarter, which saw operating and net income fall on relatively unchanged sales.
Goodyear's collective segment operating income fell 8.1 percent to $385 million, while net income fell 9.8 percent to $166 million.
The decreases were driven by the impact of lower volume and unabsorbed overhead, partially offset by favorable price/mix net of raw materials costs and net cost-saving actions, Goodyear said.
Goodyear's first quarter sales of $3.7 billion were slightly ahead of the year-ago period, largely due to improved price/mix and higher pricing of third-party chemical sales partially offset by lower tire unit volume, the company said.
"These results are a great outcome given an environment of rising raw material costs and weaker demand," Richard Kramer, Goodyear chairman, CEO and president.
"While raw-material inflation has moderated in recent weeks, we continue to expect a significant year-over-year headwind in 2017," he said. "We remain confident in our ability to offset raw-material cost inflation over time."
Tire unit volumes fell 4 percent to 40 million, including an 8 percent drop in original equipment unit volume, primarily due to lower U.S. auto production in the first quarter, according to Goodyear, noting the comparison with very strong volumes in the U.S. and China OE market during the first quarter of 2016.
Replacement tire shipments fell 2 percent during the quarter.