“Only Over My Dead Body” – Goodyear And Dunlop Brands Remain In Competition

Sylvain G. Valensi (58), who has 34 years’ service with Goodyear, latterly as Vice President Goodyear Europe, has, since the joint venture with Sumitomo Rubber Industries (SRI), assumed the role of Vice President of Goodyear Dunlop Tires Europe. Talking to this magazine during the recent “Reifen 2000” exhibition in Essen, he stressed that the major brands Goodyear and Dunlop will remain independent and will almost be in competition with each other.

There is no way that Goodyear sales people will also sell Dunlop tyres and the sales forces will also remain independent. A change would only be possible “over my dead body” said Valensi. He pointed out that Goodyear paid roughly US$ 1 billion not only for the tyre plants in Europe and North America, but also for the brand name Dunlop, which is world-famous.

The company is now very busy exploring possible synergies and is focussing on everything “behind the curtain” – in other words, areas that consumers do not see, or which are of no interest to them, such as manufacturing, administration and distribution. Valensi was satisfied that recently-implemented price increases are now sticking, or at least two-thirds of them, which should be adequate to compensate for these costs. As far as multi-brand strategies are concerned, Valensi pointed out that Goodyear has operated such a system in Germany for years and it is now up to the Dunlop brand to develop and strengthen a similar strategy.

Instead of focussing on purchase price, the manufacturer is keen to offer a full package which guarantees more value for the end consumer. At the moment, the currency situation is definitely not on Valensi’s side and, following the “profit warning” that the top management in Akron felt forced to issue at the end of June, it seems clear that the group will not make the expected impressive turnaround this year, but that it will be delayed to next year. This means that the pressure on the European arm of the rubber giant to cut costs will be even more intense.