Goodyear's sales drop 2.3%, expects flat market

"The second quarter proved challenging in both our consumer and commercial businesses, driven by industry disruption stemming from shifts in global trade—including a surge of low-cost imports across our key markets," Goodyear CEO and President Mark Stewart said. "We expect conditions to stabilize in the coming quarters, and we see clear opportunity ahead as we capitalize on our strong U.S. manufacturing footprint. We continue to expect to exceed the original goals for Goodyear Forward both in terms of cost savings and proceeds from asset sales."

Net income increased to $254 million, up from $79 million in 2024.

Income was helped by an estimated gain of $385 million from the sale of the Dunlop brand to Sumitomo Rubber Industries, plus rationalization charges and Goodyear Forward costs of $59 million and $5 million, respectively.

Regional results

In the Americas, Goodyear sold 19.1 million tires—down 2.6% from 19.6 million units in the second quarter of 2024. Goodyear says replacement tire volume was down 2% due to consumer due to consumer replacement, while OE tire volume dropped 5%. 

Net sales in the region totaled $2.66 billion, down almost 1.3% from the prior year. The tiremaker said those declines were driven by lower replacement volume, partially offset by benefits in price/mix.

Higher raw material costs, inflation, and other costs were the driver behind a $100 million decrease in segment operating income. The decreases were partially offset by price/mix benefits and Goodyear Forward benefits.

In EMEA, tire units dropped 2%. Replacement units fell 7.3% due to consumer replacement channel restocking, while OE unit volumes jumped 10.9%, the company said.

Higher raw material costs also contributed to a segment operating loss of $25 million, compared to income of $30 million a year ago.

In the Asia-Pacific region, tire unit volume fell 15.6%. Both replacement and original equipment volumes were off double digits. The OE units were down 13%, due to customer mix in China.

The drop off in unit volume resulted in regional net sales that fell by 22.7%. The sale of Goodyear’s off-the-road tire business also contributed to the dropoff, the company said.

View of imports 

In the consumer tire market, Goodyear said U.S. sellout has been flat. But sell-in has been driven by a 15% increase in imports from non-U.S. Tire Manufacturers Association (USTMA) members.

On the commercial side, Goodyear said those non-USTMA members have imported 32% more units.

Goodyear’s take on 2025

In the consumer tire business, Goodyear expects 2025 to end with a market that is flat to down by 2%. The expectation is for a “slight contraction driven by U.S. volatility related to imports/prebuy” in the replacement market, and trade uncertainty that will affect global OE tire demand.

For commercial tires, Goodyear’s range is a little wider, from up 2% to down 2%. The replacement segment should result in slight growth, driven by imports, while trade uncertainty will affect OE demand in the U.S.

Benefits of Goodyear Forward

Goodyear said its segment operating income reflected $195 million in benefits from its Goodyear Forward plan. In February, the company completed the sale of its OTR business to Yokohama Rubber, with cash proceeds of $905 million.

Then in May, the sale of the Dunlop brand to Sumitomo Rubber Industries resulted in cash proceeds of $735 million. Since then, Goodyear reached a third agreement to sell its chemical business. That deal is expected to close in late 2025, and will add to the $1.6 billion in gross proceeds from asset sales.

View on distribution

Following the release of its second quarter financials, Goodyear hosted an investor call to go more in-depth into its financials.   

Stewart said the company has done assessments on operational capabilities, service rates, stability, and alignment, and the company decided to strengthen its partnership with TireHub LLC. 

“We don’t want to work with individuals that aren’t representing our full portfolio,” said Stewart. "We see a lot of benefit of working with fewer but much more aligned distributors to build our Goodyear family brands and servicing our dealers and retailers effectively and efficiently with a full product screen that we have available to the marketplace.  

Christina Zamarro, Goodyear's executive vice president and chief financial officer, said that due to a distribution transition, 95% of Goodyear retailers had voluntarily made the switch to a new distributor from American Tire Distributors by the end of July. 

Additionally, the Akron, Ohio-based company is extending its offerings in the 18-inch and above segment, which made “record gains” in the past quarter.  

Goodyear is also planning on introducing 11 new product launches in the back end of the year—in North America, in particular—and will create 500 new SKUs between the U.S. and EMEA, heavily focused on 18-in. and above products.