The Original Equipment Tire and the Replacement Tire Market

The tire industry is global in scope, and competitors originate, produce and market their product world wide in which Goodyear is the second largest producer, with Goodyear, Kelly-springfield, Lee and Douglas being its most well known brands among The tire industry divides into two end-use markets:

The original equipment tire and

The replacement tire market

Original equipment tires are sold by tire manufacturers directly to automobile and truck manufacturers. One among the automobile is Honda of U.S. where Goodyear recorded a 30.0% of market share in contrast to 47% of Michelin's share. Price being more competitive among the tire manufacturers brand makes an easy shift by car and truck manufacturers to a competitor's brands. Tire manufacturers considered this market strategically important even though it is less profitable to the replacement tire market. It was believed that car and truck owners who were satisfied with their original equipment tires would buy the same brand when they replaced them.

Goodyear Tire and Rubber Company Overview

Goodyear Tire and Rubber Company, headquartered in Akron, Ohio, was founded in 1989 by Frank and Charles Seiberling. The company began as a supplier of bicycle and carriage tires, but soon targeted the fledging automotive industry. The introduction of the quick detachable tire and the universal rim (1903) helped make Goodyear the world largest tire manufacturer by 1916, the same year the company introduced the pneumatic truck tire. Goodyear held the distinction as the world leader in tire production until November 1990, when Groupe Michelin acquired the Uniroyal Goodrich Tire Company (then the second largest U.S. tire manufacturer) for a purchase price of $1.5 billion