Akron, Ohio-based Goodyear Tire & Rubber (ticker: GT) revealed a strategic plan aimed at decreasing leverage and cutting costs. With a focus on optimizing its factories and making adjustments to its overall footprint, the company expects to achieve an annual benefit of $1 billion by the end of 2025.
Additionally, Goodyear is exploring strategic alternatives for its chemical business, the Dunlop brand, and the off-the-road equipment tire business. These measures are part of Goodyear’s broader transformation plan, aptly named “Goodyear Forward,” which aims to create a more profitable and focused company.
To support its debt reduction efforts, Goodyear plans to allocate approximately $1.1 billion for restructuring purposes. The company estimates that this move will bring its debt close to an investment-grade credit rating.
In a separate press release, it was announced that Goodyear CEO Richard Kramer will retire next year. The company’s board has already initiated a search for a new chief executive.
Goodyear’s shares traded higher in response to these announcements, rising 9.8% to $15 in premarket trading on Wednesday.
Stay tuned for more updates as Goodyear hosts its conference call at 8:30 am Eastern time.