Goodyear Results Led By Assurance

Goodyear’s Assurance played a key role Goodyear’s recent financial improvements, according to a report in the Akron Beacon journal. Goodyear first rolled out the products a year ago in an effort to generate excitement for its flagship brand.

The company’s recent financial report seems to suggest that the strategy has worked. Publishing its full-year 2004 results, Goodyear posted its first annual profit ($114.8 million) for four years. Executives credit new products, including Assurance, for assisting the turnaround. Goodyear said it sold more than 2 million Assurance tyres last year, making it the biggest launch ever in the company’s 107-year history. It even surpassed the Aquatred, a wet-traction tyre launched in the early 1990s that sold about 1 million tyres in its first year. The Assurance accounted for roughly 2 per cent of the 102 million tyres Goodyear sold in North America last year, the company reports

“If you just look at that 2 million, you will underestimate the impact the Assurance tyre has had on [our business in] North America,” said Goodyear chairman and CEO, Bob Keegan. “There’s a huge halo effect. We’re buying credibility with dealers, with consumers, and frankly with our own people through these launches.” Goodyear said its latest launch of SilenArmor SUV tyres is off to a fast start as well, with orders coming in for the tyres even faster than for Assurance, the Beacon Journal reported.

Goodyear has been able to raise its prices four times since the beginning of last year, but now, unlike in previous years, the price increases are sticking. According to analysts, this reflects the brand’s higher value in the market. The price increases and premium tyres have helped Goodyear increase its revenue per tyre by 8 percent in the fourth quarter of last year, the company said.