Shares of Akron, Ohio based Goodyear Tire and Rubber (NYSE: GT) are trading in the red this morning after the company reported dismal fourth quarter and full year 2008 earnings this morning.Going into today's earnings release, analysts had been expecting to see the company show a $1.03 per share loss for its fourth quarter, but the results came in worse than expected, with a quarterly loss down at -$1.37 per share. This compares to a profit during the same period last year of 23 cents per share.
Times are tough for the company right now, which is dealing with rising raw material costs, and reduced demand for its tires by the struggling auto makers, which have been scaling back their vehicle production in order to combat the economic slowdown.
In reaction to the current situation, Goodyear is looking to reduce its costs anywhere it possibly can, and it announced this morning that it was going to be looking to reduce 5,000 jobs. In addition, it is going to be freezing employee salaries and looking at possible asset sales to help out its bottom line. Today's announced cuts come on the heels of 4,000 job cuts in the latter part of 2008.
Quarterly revenue came in at $4.14 billion, which missed the $4.39 billion that analysts had been hoping to see, and its gross margin shrank from 19.5% to 11.3%, as sales continue to shrink for the tire maker.
Hoping to lure in new customers, the company announced that it would be launching a huge line of new tires in the coming year. On a global scale, look for Goodyear to release 50 new tire brands, which it hopes will bring customers back into showrooms.
Shares of the stock are trading down 1.8% in early morning trading, down $0.12 to $5.90
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