Specialist
Former VP at Cooper Tire & Rubber Co
Agenda
- Competitive dynamics between global tyre manufacturers
- Deal synergies across manufacturing costs and R&D developments
- Potential top-line cannibalisation issues and customer base overlaps
- Pandemic implications on raw materials costs, tariffs, supply shortages
- Sense check on deal structure, leadership, expectations of first two years
- Outlook, deal closure and post-pandemic landscape
Questions
1.
What are your thoughts on the current state of the US tyre industry? What key trends and themes should investors monitor right now?
2.
What are your thoughts on Goodyear acquiring Cooper Tire?
3.
Cooper has focused on the aftermarket and its private label business. How do you think Goodyear might approach this? Do you think there might be some rationalisation of this side of the business or do you think Goodyear will invest and focus more here?
4.
Can you elaborate on Goodyear’s opportunity in the OE [original equipment] channel? Could you put a dollar value on it or talk about how we should understand its longer-term prospects?
5.
Are there any top-line cannibalisation issues we should be aware of around the deal, perhaps regarding customer overlaps between Cooper and Goodyear?
6.
Goodyear will now have Cooper, Dunlop, Kelly and Mastercraft in the North American market. If you had to pick one or two of those that you think would be best to rationalise or shut down, which would you pick and why?
7.
Since this deal strengthens Goodyear’s presence in the North American and US markets, to what extent do you think it will put pressure on Michelin and Bridgestone? How should those companies think about this acquisition?
8.
What manufacturing synergies do you think are realistically attainable for the combined companies? The combined entity has over 50 factories globally.
9.
Goodyear says the deal will enable it to target new mobility and fleet solutions. What might be the revenue upside here longer term?
10.
The deal is worth USD 2.8bn. Do you have any reaction to this? Does that strike you as too high or too low?
11.
How do you think about the profit position in the North American market, given the tariff situation? If the tariff situation changed what might change about the market’s profitability?
12.
Where do you expect raw materials pricing to go over the next couple of years? How do you think about the buying power of the combined entity, and its ability to drive down its cost of goods?
13.
Do you have any thoughts on Goodyear’s management team? How confident are you in their ability to maximise the value of Cooper with the acquisition?
14.
Are there any post-pandemic new normals for the tyre industry or the combined Goodyear-Cooper entity that you want to highlight over the next 1-2 years?
15.
Do you expect any more industry consolidation over the next couple of years? Could anyone ever acquire ATD [American Tire Distributors]?
16.
Where do you think Goodyear and Cooper stand in the EV [electric vehicle]-friendly and recycled tyre categories?
17.
What do you think are the best- and the worst-case scenarios for the combined entity over the next 2-3 years?
18.
Do you have any closing comments? Is there anything else you would like to discuss?
