Challenges Facing GoodyearProblem Statement There are several challenges facing Goodyear in today's environment. Our sales have stabilized in recent years and we need to increase our market share in order to improve these figures. Our debt is high and our interest payments are eating into our profile, so we need to get more income to pay off this debt. The most immediate question is whether Goodyear should launch its new AQuatre tire line. The trend is towards higher mileage tires and the Aquatred tire does not fit into this trend, being more of a high-end tire. Also, if we decide to launch the AQuatre, do we start advertising during the Olympics when we don't have all tire sizes available? We also determine whether maintaining our current distribution channel is the best approach or whether we need to expand the way our tires come to market. If we decide to expand our distribution channels, then we need to determine which tires we will offer in the new channels. Finally, our market share in the replacement market is insufficient, but we are not sure that this is true, and since consumers believe that buying tires is a necessity, we need to find a way to encourage them to buy our product. Goodyear was once considered the gorilla of tire producers, but with increased competition in recent years, that is no longer the case. Issues: Consumption model and expectations Essentially, consumers are divided into 4 basic segments.§ There are buyers constrained by prices who buy the best brand. they have the means. They show no brand loyalty and tend to shop around for tires, so we should tire out in front of them and get the best price.§ There are value-oriented buyers who shop around a lot to get the best price, but we would generally only buy from major brands, so we would probably be able to capture that buyer through our brand, but we would need competitive pricing. § There are quality buyers who were loyal to the point of sale and the tire brand. These consumers were generally high-end and will be our primary target audience. The challenge here would be to get the tire to the point of sale where the consumer is comfortable purchasing and communicating the difference between our tires and our competitors.§ Finally...... middle of paper.. . and the company has expressed concern about making the tires as safe as possible. This is a positive outcome for the company as a whole, which should translate into higher sales for our other tire products. In conclusion, we have a unique opportunity to take advantage of a niche market that is still untapped. We have already purchased advertising time at the Olympic Games for which we will present our new Aquatred tire, as well as promote Goodyear's ongoing quest for safety and quality. We will open new distribution channels for our low-end tires to increase our market share in these areas, while ensuring that our independent dealer sales are respected and valued as much as possible. This is a very exciting time for Goodyear and the Aquatred tire. A bit long, but I like your action plan. Most important attributes for consumers when purchasing a new tire: 1. Tread Life2. Wet traction3. Handling4. Snow traction5. Dry TractionUS Passenger Tire MarketOEM Replacement TotalIndustry 152.0 43 195Goodyear 22.8 16.3 39.1Goodyear Percentage 15% 38% 20%