DETROIT — Goodyear Forward remains the centerpiece of Goodyear Tire & Rubber’s turnaround under CEO Mark Stewart, who is pushing to make the tire business more appealing to investors and friendlier for customers even as cash generation lags.
Inside a revamped Detroit tire shop dressed for the Woodward Dream Cruise, Stewart outlined how the company is reshaping its retail experience and brand image while working through a restructuring intended to stabilize the 128-year-old Akron, Ohio-based manufacturer. Despite the makeover, the CEO acknowledged the core challenge: Goodyear is still burning cash as it refinances and pays down long-standing debt.
Capital expenditures totaled roughly $2 billion across 2024 and 2025, with about $725 million expected this year. Debt stood above $7 billion at the end of the second quarter. Through the first half of the year, Goodyear posted a net loss of $453 million, with operating income of $131 million, or a 1.6% margin.
Stewart had aimed for a 10% operating margin by the end of last year. The company reached 8.5% in the fourth quarter instead, and he said hitting double digits and generating meaningful cash flow remain priorities.
Since joining from Stellantis in January 2024, Stewart has seen Goodyear shares fall more than 50% even as the company executed many parts of the plan. He cited ongoing pressure from tariffs, elevated raw material costs and competition from lower-priced imports. Overseas producers continue to enjoy cost advantages, he said.
Goodyear expects raw material costs to be roughly flat year over year overall, but forecasts a $200 million headwind in the second half, largely tied to higher commodity costs associated with the conflict in the Middle East, according to company commentary and analyst estimates.
An Aug. 17 note from Argus described the company’s recent challenges, including slower demand, rising input costs, higher capex, low-priced Asian imports and evolving trade and tariff policies. FactSet’s average analyst rating is hold with a price target of $7.60. Shares closed Friday at $6.35, down 27% year to date.
Goodyear Forward rolls on
Originally envisioned as a two-year effort through last year, Goodyear Forward is continuing as leadership maps the next phase. Stewart said the company will outline future steps at the appropriate time.
The plan, launched before Stewart’s arrival and expanded under his direction, includes deeper cuts and efficiencies. The company says it has removed roughly $1.5 billion in annualized costs.
A key pillar is shifting further into premium tires. Goodyear has been pruning its portfolio, including selling units such as the Dunlop brand, and plans to introduce more than 1,600 products this year, most in higher-margin premium categories.
Stewart said non-U.S. brands, notably Sumitomo and Yokohama, are expanding globally with lower-priced offerings. He added that Goodyear will not chase ultra-low-cost segments, noting the company will not compete with tires that can be produced for $6 to $10 in converted manufacturing costs.
Performance in Asia-Pacific has been a bright spot. Segment operating income in the second quarter was $63 million, with a 12.7% operating margin.
U.S. operations have weighed on results as consumer demand softens. The company said cash burn is expected to continue into 2027, but should moderate as it closes a plant in Fayetteville, North Carolina, next year. That move is projected to lift Americas segment operating income by $270 million annually. Stewart called the closure a difficult but necessary step given the facility’s competitiveness.
The turnaround effort accelerated after Elliott Investment Management disclosed a stake in 2023 and supported three new board members. A spokesperson for Elliott declined to comment on the company or its current position.
Goodyear blimps flying high
Marketing remains central to Goodyear Forward, with an emphasis on connecting brand visibility directly to tire sales. The company continues to leverage its iconic blimps as high-impact advertising platforms.
Stewart said Goodyear has integrated blimp activations with retail promotions, including “buy to fly” campaigns that award flights on the aircraft to tire retailers and consumers. The Detroit store relaunch coincided with the car festival’s large crowds, where the company staged a rare double-blimp appearance and displayed smaller “mini blimps” to boost engagement.
Stewart said the goal is to remind consumers of the brand’s heritage while channeling that awareness into premium product demand.