Goodyear and Dunlop slash jobs in Australia
Dunlop’s local future unclear as Goodyear puts it up for saleThe Dunlop tyre brand is up for sale in Australia as its financially embattled parent Goodyear slashes its local workforce by up to 700 employees.
The potential sale of Dunlop – which Goodyear owns in North America, Europe, Australia and New Zealand – was announced yesterday in the USA as part of a global transformation plan dubbed ‘Goodyear Forward’.
But the local restructure and its job cuts first appeared in ‘8-K’ financial papers issued in the US by parent company Goodyear Tire and Rubber Company in September.
The restructure includes the closure of nine warehouses and the sale or closure of 100 Beaurepaires tyre stores.
As part of the deal the distribution of Goodyear tyres in Australia and New Zealand has been awarded to wholesaler TyreMax and the distribution of Dunlop has been awarded to wholesaler and retailer National Tyre and Wheel.
It is also understood that two commercial tyre retread plants are to be sold or closed as part of the restructure, although this has not been confirmed.
The local Goodyear & Dunlop Tyre Australia & New Zealand business is planned to continue, in part to manage the Goodyear Autocare franchise and Dunlop Super Dealer licensees.
However, the local restructure might become irrelevant if Goodyear Tire succeeds in selling off its rights to the Dunlop tyre brand, which it values at $US700 million ($A1.080 billion).
National Tyre and Wheel issued an ASX announcement yesterday confirming it was seeking clarification from GDTA about the sale of the Dunlop brand.
“NTD is seeking clarification from Goodyear and NTD’s advisors about the implications, if any, a sale of the ownership of relevant intellectual property would have on the Agreements and the opportunities such a sale may present for NTD,” the statement read.
“As Goodyear is in the early stages of its strategic review, further clarity about possible implications (including any opportunities for NTD), is not expected until 3Q24.
“The distribution of Dunlop brand tyres by NTD in New Zealand commenced on 1 November 2023. Preparatory work for the commencement of NTD’s distribution of Dunlop brand tyres in Australia from March/April 2024 is continuing.”
All up through various sales Goodyear is seeking to free up $US2 billion as its seeks to reduce debt, increase profitability and boost its stock price.
Goodyear global executives have expressed confidence they will find a buyer for Dunlop. Sumitomo, which makes Dunlop tyres in certain international markets such as Japan, is being touted as a potential new owner.
Chinese players – which have done much to damage the finances of established tyre brands such as Goodyear as they enter western markets including Australia – are also being linked with purchasing the brand.
The dramatic restructure of Goodyear and Dunlop is the latest stage in an epic fall from grace in Australia.
Goodyear was a co-owner of the South Pacific Tyres plant with Pacific Dunlop from 1987 and took over the Dunlop brand and the factory outright in 2006. It closed the plant, then making 10,000 tyres per day, in 2008.
Dunlop has been a continuous brand in Australia for 130 years and is the tyre supplier to the Supercars championship.
Contacted by carsales, a Goodyear Tire media representative confirmed only information already publicly available on the restructure.
There has been no response to repeated requests for the pre-restructure headcount at GDTA or what it will be after the 700 jobs go.
The headcount is given at 1400 on the GDTA website, but there is no timestamp on that number and it is understood to be out of date.
Goodyear says in its financial papers that the Australia and New Zealand restructure will be completed by the end of 2024 at a pre-tax cost of up to $US65 million ($A100 million).
“These actions are expected to improve Asia Pacific’s segment operating income by approximately (US) $50 million to $55 million ($77-$85 million) in 2025 and annually thereafter, primarily through a reduction of selling, administrative and general expenses,” the Goodyear financial papers state.
Related: Goodyear unveils 90% sustainable material tyre approved for road use
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