Goodyear Earnings Drop 90 Percent From a Year Ago

AKRON, Ohio The AP reported today that The Goodyear Tire & Rubber Co.'s earnings fell about 90 percent in its second quarter, citing fewer orders from the auto and commercial truck industries.

The results matched Wall Street expectations, but chairman and chief executive Samir Gibara also warned that ``more production curtailments will be needed in the third quarter until demand improves.''

It was not immediately known whether that means Goodyear would eliminate more jobs. Goodyear had said after the first quarter that job cuts this year would total about 7,800.

In midday trading on the New York Stock Exchange, Goodyear was down 3.5 percent, or $1.11 a share, to $30.53.

Goodyear earned $7.8 million, or 5 cents per share, in the quarter that ended June 30, down from $77.1 million, or 49 cents per share, in the second quarter of 2000.

Sales were $3.6 billion, about the same as in the year-ago period.

Goodyear said reduced original equipment shipments to manufacturers of autos and commercial trucks were partially offset by price increases and selling a greater percentage of higher-priced tires in the replacement market.

They went on to report that``The ongoing slowdown in the auto and commercial truck industries around the globe have led to a significant reduction in orders,'' Gibara said. ``Additionally, sluggish economies and significant currency devaluations in Europe, Asia, Turkey and Brazil had a negative impact on both sales and earnings during the quarter.''

In North America, the world's largest market, industrywide shipments of consumer replacement tires were up about 1 percent during the second quarter of 2001 compared with last year. However, Goodyear's shipments in this segment grew more than 10 percent.

Gibara said that Goodyear continues to gain market share in a market that has included a Bridgestone/Firestone Inc. voluntary recall of about 6.5 million tires.

The company's loss for the first half of 2001 was $38.9 million, or 25 cents per share, compared with net income of $125.3 million, 79 cents per share, the first half of last year. Sales for the first six months of 2001 were $7 billion, down from $7.3 billion in the same 2000 period of 2000.