News
News Home
Quick Bites
Exploradio
News Archive
News Channel
Special Features
NPR
nowplaying
On AirNewsClassical
Loading...
  
School Closings
WKSU Support
Funding for WKSU is made possible in part through support from the following businesses and organizations.

Meaden & Moore

Hospice of the Western Reserve

Knight Foundation


For more information on how your company or organization can support WKSU, download the WKSU Media Kit.

(WKSU Media Kit PDF icon )


Donate Your Vehicle to WKSU

Programs Schedule Make A Pledge Member BenefitsFAQ/HelpContact Us


Goodyear to build new plant by 2017
Tire company says it will begin site selection on a plant to serve North and Latin Americas
by WKSU's AMANDA RABINOWITZ


Morning Edition Host
Amanda Rabinowitz
 
Download (WKSU Only)

Akron-based Goodyear Tire and Rubber says it plans to build a new plant in the Americas for the first time in more than two decades. On a conference call with investors Thursday morning, Goodyear says the new factory is one of handful of initiatives benefitting from increased cash flow. The company will spend about $500 million on the factory that will produce about six million tires annually.

Vice President and CFO Laura Thompson says site selection is under way and that tire production is expected to begin in the first half of 2017.

Click to listen

Other options:
Windows Media / MP3 Download (0:19)


 “Clearly that plant has to be able to meet the needs of both North America and Latin America," Thompson said. "So there are many, many criteria including things like looking at the currencies, looking at the labor rates, looking at the electricity flow, looking at all the different things that go along with it.“

The trade publication Tire Review is reporting that Chester County, South Carolina, is the prospective site for the plant, but Goodyear says speculation is premature. The last time Goodyear built a plant in the region was in 1990 in Napanee, Ontario.  Thompson says a decision on the new plant’s location could be made by the end of the year. 


Goodyear Tire & Rubber Press Release:

AKRON, Ohio, May 29, 2014 – The Goodyear Tire & Rubber Company today announced an update to its 2014-2016 capital allocation plan focused on increasing shareholder returns and capturing high-return growth opportunities in North America and Latin America.

Due to Goodyear’s strong 2013 free cash flow, which enabled the full funding of its hourly U.S. pension plans in early 2014, the company is reallocating approximately $1.1 billion of its
2014-2016 cash flow.

The updated capital allocation plan, which aims to increase shareholder value by providing approximately $650 million in returns to investors, strengthening the balance sheet and investing in high-return growth, includes:

•  Allocating an additional $300 million to growth capital expenditures to enable the company to build a new plant to serve its North American and Latin American consumer tire businesses and capitalize on the anticipated growth in high-value-added tire markets in the two regions.
•  Increasing the quarterly cash dividend on Goodyear’s common stock by 20 percent to
6 cents per share from 5 cents per share beginning in September. The payout represents an annual rate of 22 cents per share for 2014 and 24 cents per share for 2015.
•  Increasing the share repurchase program by $350 million to allow Goodyear to acquire up to $450 million of its stock through 2016.
•  Based on company performance, the shareholder return program can be increased up to an additional $250 million, to a total of $900 million.
•  Allocating an additional $400 million towards debt reduction, further strengthening Goodyear’s leverage metrics and advancing the company’s objective of achieving an investment grade credit rating.

“This updated capital allocation plan for 2014-2016 reflects Goodyear’s commitment to balancing all our priorities – returning cash to shareholders, investing in high-return growth projects and achieving investment grade metrics – to drive long-term shareholder value consistent with our articulated strategy,” said Richard J. Kramer, chairman and chief executive officer.

The new tire plant will support Goodyear’s long-term growth in high-value-added consumer replacement and original equipment market segments. “Our investment supports another key element of our strategy – to focus on winning with consumers in profitable market segments,” Kramer said.

“With growing consumer demand for our high-value-added tires in North America and Latin America, the time is right to invest in additional manufacturing capacity in the Americas to maintain Goodyear’s leading position and to grow earnings beyond 2016,” he said. “Goodyear is well-positioned to meet this market demand and has a proven track record of producing strong returns on capital investments.”

Goodyear plans to invest approximately $500 million to build the new plant, which will be its most technologically advanced and have an initial capacity of about six million tires per year. Capacity can be increased as demand increases. Site selection is underway to identify the best location for the plant to support North America and Latin America customers. Tire production is expected to begin in the first half of 2017.

The company also reaffirmed its 2014-2016 financial targets, which include:

•  Segment Operating Income growth of between 10 percent and 15 percent per year and
•  Annual positive Free Cash Flow from Operations.
Additionally, the company continues to expect a 2 percent to 3 percent increase in unit volumes for 2014 over 2013.

Add Your Comment
Name:

Location:

E-mail: (not published, only used to contact you about your comment)


Comments:




 
Page Options

Print this page

E-Mail this page / Send mp3

Share on Facebook




Stories with Recent Comments

HUD and Cuyahoga Land Bank extend a housing deal for another year
Need to sale lot, and would like to know how to contact someone to see if they may be interested in the property that sat between two lots. If you can give me...

Akron Beacon Journal details abuse claims against televangelist Angley
In the early 90's I went forth for pray. And the man was anointed by the hand of God. Just a fact I will never forget

Lawmaker questions why a million voters didn't get absentee applications
He's a damn lie! I vote n all elections. I missed 1. Haven't gotten my absentee ballot and their making it hard to get one.

Thirsty Dog Brewery warns it might have to leave Akron
Why is it the city's responsibility to find this guy a location? There are a hundred realestate companies that could help him.

Kent State sends home three after contact with second Ebola-stricken nurse
Why weren't all health workers who were around Duncan quaranteened for 21 days and tested for Ebola? That's a no-brainer. Why was Vinson allowed to travel right...

New book says Willoughby Coal is haunted...and that's good for business
Would love to see a series of books that would just thrill me. I cannot wait to visit some of the locations. And revisit some of the locations I have already vi...

Cleveland Indians to continue with 'dynamic pricing'
pricing is too high for a family as well as people like me who are on a fixed income. Bleacher seats are cheaper but concessions are rediculous.

Kasich talks about faith, drugs and education -- but never FitzGerald
The idea that you can learn more by talking to a 90 year old person than from a history book is just another example of how the GOP hates education and knowledg...

Third-grade charter school students fail state testing
A partisan anti-charter group came out with analysis that ODE says is based on incorrect data. So why is this a story? It doesn't seem to rise to WKSU's typic...

Still no money for Fair Finance victims
The only persons benefiting from this bankruptcy is quite obvious - the attorneys.. I would let the Durham and other thieves out of prison in a job with all th...

Copyright © 2014 WKSU Public Radio, All Rights Reserved.

 
In Partnership With:

NPR PRI Kent State University

listen in windows media format listen in realplayer format Car Talk Hosts: Tom & Ray Magliozzi Fresh Air Host: Terry Gross A Service of Kent State University 89.7 WKSU | NPR.Classical.Other smart stuff. NPR Senior Correspondent: Noah Adams Living on Earth Host: Steve Curwood 89.7 WKSU | NPR.Classical.Other smart stuff. A Service of Kent State University