AKRON, Ohio (AP) -- Goodyear Tire & Rubber Co. says it needs to cut costs because of slumping tire sales.
The Akron, Ohio-based company said Tuesday it will be announcing its cost-cutting plans Feb. 18, when Goodyear releases its earnings report of the 2008 fourth quarter and full year.
Darren Wells, Goodyear's executive vice president and chief financial officer, said in a conference call to analysts that tire industry sales in North America for consumer purchases of replacement tires were down about 3.5 percent in 2008 compared with 2007. Sales in the original equipment market were down 22 percent.
Wells said Goodyear must reduce the amount of tires available for sale in part by adjusting tire production at factories. He said the company will focus on new products, including a tire designed for fuel efficiency.
Speaking later Tuesday to participants the JP Morgan High Yield Conference in Miami Beach, Fla., Wells said Goodyear has also seen a drop in international sales. He added that the company is placing more importance on selling replacement tires, a market that makes up more than 80 percent of Goodyear's revenue.
Goodyear shares rose 15 cents, or 2.5 percent, Tuesday to $6.12.