Goodyear Tire & Rubber Company Lays Off 5,000
Could the slumping world economy force even Goodyear to reconsider its commitment to NASCAR?
Goodyear Tire & Rubber Company has been closely associated with NASCAR for more than 50 years. In February 2007, NASCAR and the Akron, Ohio-based company announced that Goodyear would continue as the sport's exclusive tire supplier at least through 2012 -- insert your own Tony Stewart joke here.
It's arguably unreasonable to think Goodyear should curtail its association with NASCAR in light of the overall economy and the recent announcement that it is laying off 5,000 workers -- even I understand the inherent value of the company's relationship to this country's number one motorsport. Nevertheless, and if, as some in the industry fear, the auto sector has entered a prolonged period of seriously depressed sales, Goodyear is likley to endure an even more pronounced slump than the one it finds itself in now.
If and when the dust settles and fewer and fewer tires are being sold and less and less profits are being generated, any and all expenditures not directly associated with producing the best tire for the lowest cost will be scrutinized. It stands to reason that Goodyear's association with NASCAR could be one of the line items that the bean counters in Akron choose to focus on.
Insert your own Tony Stewart joke here ...
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Understood. I even agree that there are at least a few other companies that might be happy to fill a void (and I remember the tire wars). However, and purely hypothetically, it would be a blow for a Goodyear to leave; even more to the point, one could assume that the next company in line would have to pony up less cash to secure the spot as exclusive supplier--and we all know how the France family feels about maximizing its earning potential...
Let's not kid ourselves. Everything that has a cost has a line item under the spotlight as well. In the case of Goodyear, if it disconnects with NASCAR there are several tire companies that are more than willing to pick the bones of the tire giant. They DO NOT want that to happen. It makes them look like failures, something that despite cost cutting in marketing, they cannot afford.
Hoosier, who have participated in the past, and Michelin come to mind as willing to dive in and supply the American series. Hoosier would love to take the top dog status in NASCAR, provided, that is, that they have run their business cost effectively.
Michelin, would immediately make a bid for the series as they are no longer in Formula One and feel they can produce a tire that would be far less an effort they had to contend with in the Bridgestone/Michelin F1 tire war. America is one of, if not the biggest market they have.
I personally don't think Goodyear is going anywhere. As crazy at it may sound, they also cannot afford to be perceived as being chased out of the series by Tony Stewart.
Michele Rahal
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absolutely, get back to roots and away from goodyear..