SOME GOOD NEWS FROM A REVIVED GOODYEAR
Stanley Gault has now worked wonders for two household-name manufacturing companies: Rubbermaid Inc. and Goodyear Tire and Rubber Company.
As chairman and chief executive officer of Goodyear since 1991, Mr. Gault has cut the company's $3.7 billion debt nearly in half, increased worldwide sales, and inspired a resurgence in the morale of his 93,000 "associates," as he calls his employees.
"Despite tremendous adversity, American industry has responded with better quality, better costs, and higher customer satisfaction," says Gault, who was in Boston to address a CEO Breakfast Forum hosted by Northeastern University's business school.
At Goodyear, the wake-up call came in 1990 when the company recorded its first loss in 58 years. Foreign competitors gobbled up a number of United States tire companies and pushed Goodyear out of the first-place position it had held since 1916. So the company trimmed its work force 13 percent, introduced a flurry of new products, and increased efficiency. In less than three years, Goodyear's stock market value has quintupled.
"It is imperative that this nation have a revitalization of manufacturing," Gault says. "Good-paying manufacturing jobs ... [bring] good buying customers for all of our products and services."
As he looks at the overall US economy, Gault's first priority is controlling the national debt. He learned the dangers of debt at Goodyear, which was paying more than $1 million a day in interest costs when Gault took the reins. "Debt has a seven-day work week," he says. "We cannot continue to drain away the financial strength" of the US.
In addition to burdens of litigation and regulation, health-care costs are "putting American firms at a severe and growing disadvantage compared to their competitors in countries such as Japan and Germany where per capita health-care costs are less than half of ours," Gault says.
Goodyear's major competitors include Bridgestone of Japan, Continental of Germany, and Michelin of France. These firms operate "under tax systems which either openly or in a concealed fashion have tax considerations or certain incentives for exports that we do not have," Gault says.