In this recession, people aren't spending on tires either. Goodyear this reported a loss of $330 million, or $1.37 a share--$1.18 a share excluding one-time items. Analysts were expecting a loss of $1.03 a share.
That means Goodyear is cutting costs. The company says it is cutting 5,000 jobs (7 percent of its workforce, roughly) in addition to the 4,000 it cut in the second half of last year. Goodyear is also freezing salaries in its effort to slash expenses by another $700 million in 2009--boosting its total cost savings plan target to $2.5 billion.
From the earnings release:
“Given lower industry demand, we are taking aggressive action, reducing tire production, cutting costs and adjusting investments to better match market conditions,” said Robert J. Keegan, chairman and chief executive officer.
“The many positive actions we took and the results we achieved in 2008 provide a base from which we will address the market challenges we will inevitably face in 2009,” he said.