2. Goodyear Position in Tire Industry The US tire industry was denominated by 5 companies in the early 1970’s where all the players are from US Goodyear, Firestone, Uniroyal, BF Goodrich, General Tire. Goodyear known as the ‘Gorilla’ of the world Tire industry and Ranked 3 rd in worldwide new tire sales. Goodyear operated 41 Plants in US and 43 Plants in 25 other Countries, six rubber plantations, 2000 Distribution outlets worldwide, 4400 Independent dealers, 1047 manufacturer owned outlets and 600 franchise dealers. The company also had a strong track record in launching innovative new product. Goodyear had made large investment (over $1.5 billion) during the late 1970s to produce radials. Goodyear had Eagle, Aquatred, Invicta, Arriva, Tiempo, Corsa in his brand portfolio. Goodyear had produced two lines of private label tires: All American and The Concorde, which were replace by Goodyear branded tires in 1991.
3. In 1991, the Goodyear Tire and Rubber Co. were in a severely damaged position. The company had experienced its first financial loss in 58 years, and the company‘s million-a-day debt service charges had placed Goodyear to the verge of bankruptcy. Newly appointed CEO Stanley Gault, charged with the responsibility of turning the company around, recognized that Goodyear also had to increase its selling prices wherever possible. Moving forward, Goodyear‘s strategy moving would be to find and seize the industry‘s fastest-growing, highest-margin markets. Table below shows how Goodyear starts losing its market share. Brand image of major tire manufacturer, 1991
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7. To increase market share, Goodyear have to cut prices.Should Goodyear Broaden Distribution to Mass Merchandisers? Should They Be Offered Aquatred?
8. In 1991, the Goodyear Tire and Rubber Co. was in a severely damaged position. The company had experienced its first financial loss in 58 years, and the company‘s million-a-day debt service charges had placed Goodyear to the verge of bankruptcy. Selling tires to low- service outlets could erode the value of the Goodyear brand, cannibalize sales of existing outlets and might cause dealers to take on additional lines of tires. NTDRA Specialized training for new sales personnel. Problem Goodyear has to face