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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2001

Commission File Number: 1-1927

THE GOODYEAR TIRE & RUBBER COMPANY
(Exact name of Registrant as specified in its charter)

Registrant’s telephone number, including area code: (330) 796-2121

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

None

          Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days.

Yes		No

          Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein or in the definitive proxy statement incorporated by reference in Part III of this Form 10-K. .

          The aggregate market value of Registrant’s outstanding Common Stock held by nonaffiliates of the Registrant on February 15, 2002 determined using the per share closing price thereof on the New York Stock Exchange Composite Transactions tape of $24.68 on that date, was approximately $4,024,778,194.44.

Shares of Common Stock, Without Par Value, outstanding at February 15, 2002:

163,211,324

DOCUMENTS INCORPORATED BY REFERENCE:

Portions of Registrant’s definitive Proxy Statement, dated February 26, 2002,
for its 2002 Annual Meeting of Shareholders are incorporated by reference into Part III.

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THE GOODYEAR TIRE & RUBBER COMPANY

Annual Report on Form 10-K

For the Fiscal Year Ended December 31, 2001

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PART I.

ITEM 1. BUSINESS.

BUSINESS OF GOODYEAR

          The Goodyear Tire & Rubber Company (the “Company”) is an Ohio corporation organized in 1898. Its principal offices are located at 1144 East Market Street, Akron, Ohio 44316-0001. Its telephone number is (330) 796-2121. The terms “Goodyear” and “we”, “us” or “our” wherever used herein refer to the Company together with all of its consolidated domestic and foreign subsidiary companies, unless the context indicates to the contrary.

          Goodyear is one of the world’s leading manufacturers of tires and rubber products, engaging in operations in most regions of the world. Goodyear’s 2001 net sales were $14.1 billion. Goodyear’s net loss for 2001 was $203.6 million. Goodyear’s worldwide employment averaged 100,779 during 2001.

          Goodyear’s principal business is the development, manufacture, distribution and sale of tires for most applications. Goodyear also:

	•		manufactures and markets –

	•		several lines of rubber and other products for the transportation industry and various other industrial and consumer markets; and
	•		synthetic rubber and numerous rubber-related chemicals for various applications.

	•		provides automotive repair and other services at retail and commercial outlets.
	•		sells various other products.

FORWARD-LOOKING INFORMATION – SAFE HARBOR STATEMENT

          Certain information set forth herein (other than historical data and information) may constitute forward-looking statements regarding events and trends which may affect Goodyear’s future operating results and financial position. The words “estimate,” “expect,” “intend” and “project,” as well as other words or expressions of similar meaning, are intended to identify forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this Annual Report. Such statements are based on current expectations and assumptions, are inherently uncertain, are subject to risks and should be viewed with caution. Actual results and experience may differ materially from the forward-looking statements as a result of many factors, including:

	•		changes in general economic and industry conditions in the various markets served by Goodyear’s operations;
	•		price and product competition;
	•		increased competitive activity;
	•		changes in demand levels for our products;
	•		fluctuations in the prices paid for raw materials and energy;
	•		our ability to control costs and expenses;
	•		changes in the monetary policies of various countries where Goodyear has significant operations;
	•		changes in interest and currency exchange rates; and
	•		other unanticipated events and conditions.

It is not possible to foresee or identify all such factors. We will not revise or update any forward-looking statement or disclose any facts, events or circumstances that occur after the date hereof which may affect the accuracy of any forward-looking statement.

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DESCRIPTION OF GOODYEAR’S BUSINESS

General Segment Information

          Goodyear’s operating segments are North American Tire, European Union Tire, Eastern Europe, Africa and Middle East Tire, Latin American Tire and Asia Tire (collectively the “Tire Segments”), Engineered Products and Chemical Products.

          Each Tire Segment exports tires to one or more of the other Tire Segments. The sales and operating income of each Tire Segment exclude sales in respect of tires sold to other Tire Segments and include sales and operating income derived from the sale of tires imported from other Tire Segments to unaffiliated customers and tires exported to unaffiliated customers. Sales and operating income of the Chemical Products segment include sales and operating income in respect of products transferred to the Tire Segments or the Engineered Products segment.

          No customer or group of affiliated customers accounted for as much as 6.8% of Goodyear’s consolidated net sales during 2001, 2000 or 1999. Worldwide, Goodyear’s annual net sales to its ten largest customers, including their respective affiliates, represented less than 25.3% of consolidated net sales during each of 2001, 2000 and 1999.

Financial Information About Goodyear’s Segments

          Financial information relating to Goodyear’s “Segments” for the three year period ended December 31, 2001 appears in Note 20 captioned “Business Segments” of the Notes to Financial Statements set forth in Item 8 of this Annual Report, at pages 74 through 77, inclusive, and is incorporated herein.

General Information Regarding Tire Segments

          Goodyear’s principal business is the development, manufacture, distribution and sale of tires and related products and services worldwide. Goodyear manufactures and markets numerous lines of rubber tires for:

in each case for sale to vehicle manufacturers for mounting as original equipment and in replacement markets worldwide. Goodyear manufactures and sells tires under the Goodyear-brand, the Dunlop-brand, the Kelly-brand, the Fulda-brand, the Debica-brand, the Sava-brand and various other Goodyear owned “house” brands. Goodyear also manufactures tires with the brands of certain customers. Goodyear also:

	•		manufactures and sells flaps for truck tires and other types of tires.
	•		retreads truck, aircraft and heavy equipment tires.
	•		manufactures and sells tread rubber and other tire retreading materials.
	•		provides automotive repair services and miscellaneous other products and services.

          The total sales and operating income of the Tire Segments during the periods indicated were:

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          The principal class of products of the Tire Segments is new tires for most applications. The percentages of Goodyear’s consolidated net sales and operating income attributable to the Tire Segments, and the percentage of Goodyear’s net sales attributable to new tires, for each year in the three year period ended December 31, 2001 were:

          Worldwide, Goodyear’s sales of new tires to the replacement markets substantially exceed its sales of new tires to vehicle manufacturers for original equipment (“OE”). Goodyear’s worldwide tire unit sales in the replacement and OE markets during the periods indicated were:

GOODYEAR WORLDWIDE ANNUAL TIRE UNIT SALES – REPLACEMENT AND OE

          Goodyear offers two basic constructions of tires, radial and bias ply. Various belting and reinforcing materials are used as components of tires, including nylon, polyester and steel. Generally, radial tires are more durable and offer more handling performance than bias ply tires. Radial tires are also more complex and costly to manufacture than bias ply tires. Approximately 97% of all passenger tires, 86% of all light truck tires and 80% of all medium truck tires sold by Goodyear during 2001 were radial construction.

          New tires are sold under highly competitive conditions throughout the world. On a worldwide basis, Goodyear has two major competitors: Bridgestone/Firestone (based in Japan) and Michelin/UniroyalGoodrich (based in France). Other significant competitors include Continental/General, Cooper Tire, Pirelli, Sumitomo, Toyo, Yokohama, Kumho, Hankook and various regional tire manufacturers.

          Goodyear competes with other tire manufacturers on the basis of product design, performance, price and reputation, warranty terms, customer service and consumer convenience. Goodyear-brand tires enjoy a high recognition factor worldwide and have a reputation for performance, high quality and value. Goodyear believes Dunlop-brand tires have a reputation for performance, quality and value. Kelly-brand, Fulda-brand, Debica-brand, Sava-brand and various other house brand tire lines offered by Goodyear, and tires manufactured and sold by Goodyear to private brand customers, compete primarily on the basis of value and price.

          No customer or group of affiliated customers accounted for as much as 7.3% of the sales of the Tire Segments during 2001, 2000 or 1999. Annual sales by the Tire Segments to their ten largest customers, including their respective affiliates, represented less than 27.4% of the total sales of the Tire Segments during each of 2001, 2000 and 1999.

          Goodyear does not consider its tire businesses to be seasonal to any significant degree. A significant inventory of new tires is maintained in order to optimize production schedules and assure prompt delivery to customers, especially original equipment manufacturers that require “just in time” deliveries of tires or tire and wheel assemblies. Tire production and inventory levels are generally managed to avoid unnecessary increases in unit production costs and limit working capital requirements by optimizing production schedules consistent with anticipated demand.

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          Tire unit sales for each Tire Segment and for Goodyear worldwide during the periods indicated were:

GOODYEAR’S ANNUAL TIRE UNIT SALES

          Based on information available from various industry and other sources, Goodyear estimates that industry passenger and truck tire shipments worldwide during the periods indicated were:

ESTIMATED ANNUAL INDUSTRY TIRE SHIPMENTS WORLDWIDE

          Based on new tire sales, Goodyear was the world’s largest tire manufacturer during 2001. Information published by the Rubber Manufacturers Association (the “RMA”) and various other sources indicates that Goodyear’s share of the worldwide auto, truck and farm tire markets during the last three years was approximately:

GOODYEAR SHARE OF GLOBAL TIRE MARKET
(Auto, Truck and Farm Tires)

North American Tire

          Goodyear’s largest segment, the North American tire business (“North American Tire”), develops, manufactures, distributes and sells tires and related products and services in the United States and Canada. The principal class of products of North American Tire is new tires for most applications. North American Tire manufactures tires in 13 plants in the United States and Canada.

          The sales and operating income of North American Tire during the periods indicated were:

NORTH AMERICAN TIRE SALES AND OPERATING INCOME

          The percentages of Goodyear’s consolidated net sales and operating income attributable to North American Tire, and the percentages of the North American Tire’s sales attributable to new tires, for the periods indicated were:

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          Certain Dunlop-brand related businesses of North American Tire are conducted by Goodyear Dunlop Tires North America, Ltd, which is 75% owned by Goodyear and 25% owned by Sumitomo Rubber Industries, Ltd. (“Sumitomo”).

          Tires. North American Tire manufactures and sells a broad line of tires in North America for automobiles, trucks, motorcycles, buses, farm implements, earthmoving equipment, aircraft and industrial equipment and for various other applications.

          Goodyear-brand radial passenger tire lines sold in North America include the Aquatred line of tires, Eagle high performance and touring tires, Eagle Aquatred high performance tires, and run-flat extended mobility technology (EMT) tires. The major lines of Goodyear-brand radial tires offered in the United States and Canada for sport utility vehicles and light trucks are Wrangler and Fortera North American Tire also manufactures and sells Dunlop-brand, Kelly-brand, other house brand and several private brand radial passenger tires in the United States and Canada.

          North American Tire manufactures and markets a full line of Goodyear-brand all-steel cord and belt construction radial medium truck tires, the Unisteel series, for various applications, including line haul highway use and off-road service. The current truck tire line includes the Unisteel G-177, which features a high-tensile steel reinforced cording, a skid resistant tread design and a new damage resistant tread compound, and the Unisteel G-397 line haul steer tire, which features reinforced belting of super-tensile steel with a polyimide top belt for resistance to damage and rust propagation and increased retreadability. North American Tire also manufactures and distributes various lines of Dunlop-brand and Kelly-brand radial and bias-ply truck tires for sale in the United States and Canadian replacement markets.

          Several lines of tires for other applications are manufactured by Goodyear in North America, including radial and bias-ply tires for farm machinery and heavy equipment and aircraft tires for commercial and military aircraft.

          Related Products and Services. North American Tire also:

	•		retreads truck, aircraft and heavy equipment tires, primarily as a service to its commercial customers.
	•		manufactures tread rubber and other tire retreading materials for various applications.
	•		provides automotive maintenance and repair services at approximately 941 retail outlets.
	•		sells automotive repair and maintenance items, automotive equipment and accessories and other items to dealers and consumers.
	•		provides miscellaneous other products and services.

Market and Other Information

          North American Tire sells Goodyear-brand and Dunlop-brand tires to vehicle manufacturers for use as original equipment on vehicles they produce (“OE customers”) and sells Goodyear-brand, Dunlop-brand, Kelly-brand, other house brand and several lines of private brand tires through various channels of distribution for sale to vehicle owners for replacement purposes. Goodyear’s sales of tires in the North American replacement markets substantially exceed its sales of tires to OE customers.

          Tire unit sales in the replacement markets and to OE customers in the United States and Canada during the periods indicated were:

NORTH AMERICAN TIRE UNIT SALES – REPLACEMENT AND OE

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          The percentages of North American Tire’s production of new tires exported during the periods indicated were:

          Exports to affiliates were primarily to European Union Tire and Latin American Tire. North American Tire imported approximately 5.2% of the tires it sold during 2001 (8% in 2000 and 1999), primarily from Latin American Tire and Asia Tire.

          All passenger tires (except bias-ply temporary spare tires) and approximately 96% of all light and medium truck tires sold by Goodyear in the United States and Canada during the last three years were radial construction. During 2001, approximately 40.2% (39.9% in 2000 and 39.0% in 1999) of all passenger tires sold by Goodyear in the United States and Canada were high performance type tires. Industry sales of high performance tires in the United States and Canada during 2001 represented approximately 31% (36% in 2000 and 34% in 1999) of total passenger tire unit sales.

          No customer or group of affiliated customers of North American Tire accounted for as much as 11.0% of its sales during 2001, 6.1% of its sales during 2000 or 7.3% during 1999. The ten largest customers of North American Tire accounted for less than 41.6% of its sales during 2001, less than 36.0% of its sales during 2000 and less than 35.5% of its sales during 1999.

          Goodyear is a major supplier of tires to most manufacturers of automobiles, trucks, farm and construction equipment and aircraft that have production facilities located in North America, including:

          Goodyear’s major competitors in the North American tire market are Bridgestone/Firestone, Michelin/UniroyalGoodrich, Continental/General and Cooper Tire, each having manufacturing facilities and other operations in North America. Other significant competitors in North America are Pirelli, Toyo, Yokohama, Kumho and Hankook, who import most of the tires they sell, and various regional tire manufacturers that export tires to North America.

          Goodyear-brand, Dunlop-brand and Kelly-brand tires are sold in the United States and Canadian replacement markets through several channels of distribution. The principal method of distribution for Goodyear-brand tires is a large network of independent dealers. Goodyear-brand, Dunlop-brand and Kelly-brand tires are also sold to numerous national and regional retail marketing firms in the United States, including Sears Roebuck & Co., Wal-Mart, Penske Auto Centers and numerous other firms.

          In addition, Goodyear operates approximately 973 retail outlets (including auto service centers, commercial tire and service centers and leased space in department stores) under the Goodyear name or under the Wingfoot Commercial Tire Systems, Allied or Just Tires trade styles. Several lines of Dunlop-brand and Kelly-brand and various other house brand passenger and truck tires are marketed through independent dealers. Private brand and associate brand

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tires are sold to independent dealers, to national and regional wholesale marketing organizations, including TBC Corporation, retail chain marketers, including Wal-Mart, Discount Tire, Sears Roebuck & Co. and Big-O, and to various other retail marketers.

          Automotive parts, automotive maintenance and repair services and associated merchandise are sold under highly competitive conditions in the United States and Canada through retail outlets operated by Goodyear. Automotive repair and maintenance items and associated merchandise are purchased by Goodyear for distribution to many of Goodyear’s tire dealers.

          North American Tire from time to time offers various financing and extended payment programs to certain of its tire customers in the replacement market. Goodyear does not believe these programs, when considered in the aggregate, require an unusual amount of working capital relative to the volume of sales involved and prevailing tire industry practices. Tire inventories are maintained at levels designed to optimize production schedules, assure prompt delivery to customers and minimize working capital requirements. During the second half of 2001, production schedules were significantly reduced to reflect changes in demand.

          Based on data published by the RMA and information obtained from other industry sources, industry shipments of passenger and light and medium highway truck tires in the United States during the periods indicated were:

INDUSTRY ANNUAL UNIT SALES IN THE UNITED STATES

          Based on current economic forecasts, Goodyear expects the total market for passenger tires in the United States in 2002 to be 246 million tires, approximately the same as in 2001. Passenger tire demand in 2002 is expected to be 1.5% higher than in 2001 in the original equipment market and 1% lower than in 2001 in the replacement market. Goodyear estimates that demand for light and medium highway truck tires in the United States during 2002 will be 59 million units, a 4.5% increase compared to 2001.

          Goodyear sold more tires in the United States and Canada than any other tire manufacturer during the three years ended December 31, 2001. Based on information published by industry and other sources, Goodyear estimates that its share of the North American (United States and Canada) tire market during the periods indicated was approximately:

GOODYEAR’S SHARE OF TIRE MARKET – U.S. AND NORTH AMERICA

          The National Highway Traffic Safety Administration (“NHTSA”), under authority granted to it by the National Traffic and Motor Vehicle Safety Act of 1966, as amended, has established various standards and regulations relating to motor vehicle safety, some of which apply to tires sold in the United States for highway use. NHTSA has the authority to order the recall of automotive products, including tires, having defects related to motor vehicle safety. NHTSA requires the registration of tires for identification in the event of a product recall, the grading of passenger tires for treadwear, traction and temperature resistance pursuant to prescribed testing procedures and the molding of such grades into the sidewall of each tire. Passenger and highway truck tires are required to be identified by manufacturing identification codes molded on

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the sidewall of each tire. The effect of compliance with these regulations on Goodyear’s sales and profits cannot be determined. However, these regulations increase the cost of producing and marketing passenger tires in the United States.

          In November of 2000, the Transportation Recall Enhancement, Accountability, and Documentation Act (the “Tread Act”) was enacted. The Tread Act requires, among other things, tire manufacturers to: (1) report to NHTSA within five (5) working days tire recalls or safety campaigns in foreign countries in respect of tires which are identical or substantially similar to tires sold in the United States: (2) remedy tire safety defects without charge for five (5) years; (3) undertake recalls on an accelerated basis under certain circumstances, which may require the replacement of recalled tires with competitors’ tires; (4) adopt plans to prevent, to the extent reasonably controllable by the manufacturer, replaced tires from being resold; (5) conform with revised and updated tire standards under rulemaking to be completed by June 1, 2002; and (6) report to NHTSA, on a quarterly basis, a variety of claim and adjustment information beginning in 2003 that will provide consumers with assistance in identifying tires subject to a recall and provide additional information on all tires. In addition, by November 2003, all new passenger cars, vans, SUVs and light trucks shall be equipped with warning systems to indicate significant tire underinflation. Goodyear cannot at this time determine the effect of compliance with these regulations on its sales and earnings. However, the Tread Act and the regulations adopted thereunder are likely to increase the cost of producing and distributing passenger and light truck tires in the United States.

European Union Tire

          Goodyear’s second largest Tire Segment (“European Union Tire ”) develops, manufactures, distributes and sells tires for automobiles, motorcycles, trucks, farm implements and construction equipment in the member states of the European Union and in Norway and Switzerland, exports tires to other regions of the world, and provides related products and services. European Union Tire manufactures tires in 12 plants located in England, France, Germany and Luxembourg. Substantially all of the operations and assets of European Union Tire are owned and operated by Goodyear Dunlop Tires Europe B.V., a 75% owned subsidiary of Goodyear.

          The sales and operating income of European Union Tire during the periods indicated were:

EUROPEAN UNION TIRE SALES AND OPERATING INCOME

          The percentages of Goodyear’s consolidated net sales and operating income attributable to European Union Tire, and the percentages of European Union Tire’s sales attributable to new tires, for the periods indicated were:

          European Union Tire:

•

manufactures and sells Goodyear-brand, Dunlop-brand, Fulda-brand and Kelly-brand passenger, truck, motorcycle, farm and heavy equipment tires.

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	•		sells Debica-brand and Sava-brand passenger, truck and farm tires manufactured by the Eastern Europe, Africa and Middle East Tire segment.
	•		sells new, and manufactures and sells retreaded, aircraft tires.
	•		provides various retreading and related services for truck and heavy equipment tires, primarily for its commercial truck tire customers.
	•		offers automotive repair services at retail outlets in which it owns a controlling interest.
	•		provides miscellaneous related products and services.

Markets and Other Information

          European Union Tire distributes and sells tires throughout western Europe. Tire units sales to OE customers and in the replacement markets served by European Union Tire were:

EUROPEAN UNION TIRE UNIT SALES – REPLACEMENT AND OE

          The percentages of European Union Tire’s production of new tires exported during the periods indicated were:

          Most exports to affiliates were to Eastern Europe, Africa and Middle East Tire. Approximately 17.1% (20% in 2000 and 6.3% in 1999) of the tires sold by European Union Tire were imported, primarily from Eastern Europe, Africa and Middle East Tire.

          Substantially all passenger and light and medium truck tires sold during 2001 were radials. During 2001, approximately 64% (60% in 2000 and 50% in 1999) of all passenger tires sold by European Union Tire were high performance type tires.

          European Union Tire is a significant supplier of tires to most manufacturers of automobiles, trucks and farm and construction equipment located in western Europe, including:

          Goodyear is a leading tire manufacturer in western Europe. Based on data published by industry and other sources, Goodyear estimates that its share of the western European tire market was approximately 24.1% in 2001 (23.6% in 2000 and 18% in 1999), second in the region to Michelin’s 29% (30% in 2000 and 30% in 1999) market share. Other significant competitors include Continental, Bridgestone/Firestone, Pirelli, several regional tire producers and importers from other regions, primarily eastern Europe and Asia.

          Goodyear-brand and Dunlop-brand tires are sold in the replacement markets served by European Union Tire through various channels of distribution, principally independent tire dealers who sell several brands of tires. In some markets, Goodyear-brand tires, as well as Dunlop-

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brand, Kelly-brand, Fulda-brand, Debica-brand and Sava-brand tires, are distributed through independent dealers, regional distributors and approximately 514 retail outlets operated by multi-brand retail tire chains controlled by Goodyear.

          No customer or group of affiliated customers of European Union Tire accounted for as much as 4.2% of its sales during 2001, 5.0% of its sales during 2000 or 3.1% of its sales during 1999. The ten largest customers of European Union Tire represented less than 20.3% of its sales for 2001, less than 20.1% of its sales during 2000 and less than 19.3% of its sales during 1999.

          European Union Tire offers payment terms to customers in each market served consistent with industry practices in the region. The inventory levels and working capital requirements of European Union Tire are not unusual relative to the volume of sales involved and prevailing tire industry practices.

EASTERN EUROPE, AFRICA AND MIDDLE EAST TIRE

          Goodyear’s Eastern Europe, Africa and Middle East tire business segment (“EEAME Tire”) develops, manufactures, distributes and sells passenger, truck, farm and construction equipment tires in Eastern Europe, Africa and the Middle East. EEAME Tire manufactures tires at plants located in Morocco, Poland, Slovenia, South Africa and Turkey. EEAME Tire:

	•		maintains sales operations in most countries in eastern Europe, including Russia, Africa and the Middle East,
	•		exports tires for sale in North America, western Europe and other regions of the world, and
	•		provides related products and services in certain markets it serves.

          The sales and operating income of EEAME Tire during the periods indicated were:

EEAME SALES AND OPERATING INCOME

          The percentages of Goodyear’s consolidated net sales and operating income attributable to EEAME Tire, and the percentages of EEAME Tire’s sales attributable to new tires, for the periods indicated were:

          EEAME Tire:

	•		manufactures and sells Goodyear-brand, Kelly-brand, Debica-brand and Sava-brand tires and sells Dunlop-brand and Fulda-brand tires manufactured by European Union Tire.
	•		sells new and retreaded aircraft tires.
	•		provides various retreading and related services for truck and heavy equipment tires.
	•		sells automotive parts and accessories.
	•		provides automotive repair services.

Markets and Other Information

          EEAME Tire distributes and sells tires to all classes of customers in most countries in Eastern Europe, Africa and the Middle East. Approximately 98% (98% in 2000 and 1999) of pas-

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senger and light truck tires, and approximately 87% (82% in 2000 and 77% in 1999) of all medium truck tires, sold by EEAME Tire were radials. High performance type tires were 18% of all passenger tires sold by EEAME Tire during 2001 (16% during 2000 and 12% during 1999).

          Tire units sales by EEAME Tire to OE customers and in the several replacement markets served were:

EEAME TIRE UNIT SALES – REPLACEMENT AND OE

          The percentages of EEAME Tire production of new tires exported during the periods indicated were:

          Most tires exported by EEAME to affiliates were sold to European Union Tire. Approximately 18% of the tires sold by EEAME Tire during 2001 (23% in 2000 and 11% in 1999) were imported from other Tire Segments.

          EEAME Tire has a significant share of each of the markets it serves. Its major competitors are Michelin, Bridgestone/Firestone, Continental and Pirelli. Other competitors includes regional and local tire producers and imports from other regions, primarily Asia.

          EEAME Tire is a significant supplier of tires to manufacturers of automobiles, trucks, and farm and construction equipment in Poland, South Africa and Turkey. Manufacturers supplied by EEAME Tire include Fiat Auto Poland, Daewoo Poland, DaimlerChrysler South Africa, VW South Africa, Fiat Turkey and Renault Turkey.

          EEAME Tire sells Goodyear-brand tires in the various replacement markets primarily through independent tire dealers and wholesalers who sell several brands of tires. In some countries, Goodyear-brand, Dunlop-brand, Kelly-brand, Fulda-brand, Debica-brand and Sava-brand tires are sold through regional distributors and multi-brand dealers. In South Africa, tires are also sold through a retail chain of approximately 166 retail stores operated by Goodyear. In the Middle East and most of Africa, tires are sold primarily through regional distributors for resale to independent dealers.

          No customer or group of affiliated customers accounted for as much as 3.4% of the sales of EEAME Tire during 2001 (or as much as 2.8% in 2000 or 3.0% in 1999). Sales to the ten largest customers of EEAME Tire represented less than 13.7% of its 2001 sales (11.8% in 2000 and 13.0% in 1999).

          The payment terms offered customers of EEAME in each market it serves are consistent with industry practices. The inventory levels and working capital requirements of EEAME Tire are not unusual relative to the volume of sales involved and prevailing tire industry practices in the region.

LATIN AMERICAN TIRE

          Goodyear’s Latin American tire business segment (“Latin American Tire”) manufactures, distributes and sells automobile, truck and farm tires in Mexico and throughout Central and South America (“Latin America”), sells tires to various export markets, retreads and sells commercial truck, aircraft and heavy equipment tires, and provides other products and services.

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          Latin American Tire manufactures tires in plants located in Brazil, Chile, Colombia, Guatemala, Peru and Venezuela.

          The sales and operating income of Latin American Tire during the periods indicated were:

LATIN AMERICAN TIRE SALES AND OPERATING INCOME

The percentages of Goodyear’s consolidated net sales and operating income attributable to Latin American Tire, and the percentages of Latin American Tire’s sales attributable to new tires, for the periods indicated were:

          Latin American Tire manufactures and sells several lines of radial and bias-ply passenger, light and medium truck and farm tires. Latin American Tire also:

	•		manufactures and sells pre-cured treads for truck and heavy equipment tires.
	•		retreads, and provides various materials and related services for retreading, truck, aircraft and heavy equipment tires.
	•		manufactures other products, including batteries for motor vehicles.
	•		sells new aircraft tires.
	•		provides miscellaneous other products and services.

Markets and Other Information

          Latin American Tire distributes and sells several lines of tires for automobiles, trucks and farm equipment throughout Latin America to original equipment manufacturers, in the several replacement markets in the region and to various export markets. In Latin America, approximately 87.7% of all passenger and light truck tires, and approximately 39.6% of all medium truck tires, sold by Goodyear during 2001 were radials.

          Latin American Tire is a major supplier of tires to most manufacturers of automobiles and trucks with facilities in Latin America, including DaimlerChrysler, Ford, General Motors, Volkswagen, Fiat and Renault. Latin American Tire sells tires to independent dealers and distributors in the various replacement markets in Latin America.

          Goodyear is a leading participant in each of the markets served by Latin American Tire. Major competitors include Bridgestone/Firestone, Michelin and Pirelli. Other competition includes various regional producers and imports, primarily from Asia.

          Tire units sales by Latin American Tire to OE customers and in the replacement markets it serves were:

LATIN AMERICAN TIRE UNIT SALES – REPLACEMENT AND OE

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          The percentages of Latin American Tire production of new tires exported during the periods indicated were:

          Most tires exported to affiliates were sold to North American Tire. Latin American Tire imported approximately 21.5% (9% in 2000 and 8.3% in 1999) of the tires it sold from other Tire Segments.

          No customer or group of affiliated customers accounted for as much as 7.3% of Latin American Tire sales during 2001 (5.2% during 2000 or 6.5% during 1999). The ten largest customers of Latin American Tire represented less than 31.9% of its sales for 2001 (24.6% during 2000 and 24.9% during 1999).

          The working capital employed by Latin American Tire is limited to the extent possible, consistent with its sales volume and industry practices. The inventories maintained by Latin American Tire are ordinarily at levels designed to optimize production schedules consistent with anticipated demand. Payment terms are offered to customers in each Latin American country as required by market conditions.

          The operations of Latin American Tire are affected from time to time in certain countries by price controls, import controls, labor regulations, tariffs, and other restrictive governmental regulations.

ASIA TIRE

          Goodyear’s tire business in Asia (“Asia Tire”) engages in the development, manufacture, distribution and sale of tires throughout east, southeast and south Asia and the western Pacific. Asia Tire manufactures and sells radial and bias-ply tires for automobiles, light and medium trucks, farm implements, construction equipment and aircraft for both the original equipment and replacement markets. Asia Tire manufactures tires at facilities located in China, India, Indonesia, Japan, Malaysia, the Philippines, Taiwan and Thailand. Asia Tire also retreads truck, heavy equipment and aircraft tires and provides miscellaneous other products and services.

          The sales and operating income of Asia Tire during the periods indicated were:

ASIA TIRE SALES AND OPERATING INCOME

The percentages of Goodyear’s consolidated net sales and operating income attributable to Asia Tire, and the percentages of Asia Tire’s sales attributable to new tires, for the periods indicated were:

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Markets and Other Information

          Asia Tire distributes and sells tires in most countries in Asia and the western Pacific to OE customers and for the replacement markets. The number of tires sold in the replacement markets and to OE customers during the periods indicated were:

ASIA TIRE UNIT SALES – REPLACEMENT AND OE

          The percentages of Asia Tire production of new tires exported during the periods indicated were:

Most export sales to affiliates were to North American Tire and Latin American Tire. In 2001, Asia Tire imported approximately 3% (1% in 2000 and 2% in 1999) of the tires it sold from the other Tire Segments.

          During 2001, approximately 87% of all passenger and light truck tires (86% in 2000 and 85% in 1999), and approximately 3.5% of all medium truck tires (3% in 2000 and 2.5% in 1999), sold by Asia Tire were radials.

          Goodyear is a leading tire manufacturer in Indonesia, Malaysia and the Philippines and a significant supplier in Thailand, India, Korea and China. In Asia, Goodyear’s principal competitors include Bridgestone, Michelin, Yokohama, Kumho, Hankook, MRF, Ceat and several regional and local tire companies.

          Asia Tire supplies tires to global automobile manufacturers with facilities in China, India, Indonesia, Malaysia and the Philippines, including:

and to regional manufacturers, including Perodua and Proton (Malaysia), Maruti, Skoda and Telco (India) and AAT (Thailand). In the replacement market, Asia Tire sells tires through approximately 7,063 distributors and dealers.

          No customer or group of affiliated customers accounted for as much as 5.9% of the sales of Asia Tire during 2001 (3.7% during 2000 or 7.2% during 1999). The ten largest customers of Asia Tire accounted for less than 16.7% of its 2001 sales (15.2% in 2000 and 22.8% in 1999).

          Ordinarily, the working capital requirements of Asia Tire are low relative to the volume of sales involved and are consistent with prevailing tire industry practices in the region. During the past three years, working capital requirements have increased somewhat due to the economic downturn in most of the region.

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          Asia Tire information does not include the operations of South Pacific Tyre, an Australian Partnership, and South Pacific Tyres N.Z. Limited, a New Zealand Company (together, “SPT”), joint ventures 50% owned by Goodyear and 50% owned by Pacific Dunlop Limited. SPT is the largest tire manufacturer in Australia and New Zealand, with 3 tire manufacturing plants and 16 retread plants. SPT sells Goodyear-brand and Dunlop-brand tires through a chain of 498 retail stores and commercial tire centers owned by SPT. For additional information regarding SPT, see Note 20, “Business Segments”, of the notes to Financial Statements set forth in Item 8 of this Annual Report, at page 74.

          The net sales and operating income of SPT during the periods indicated were:

          Asia Tire includes the activities of two joint venture companies in Japan, each 25% owned by Goodyear and 75% owned by Sumitomo. One company distributes Goodyear-brand passenger and truck tires manufactured by Sumitomo in Japan, or by Goodyear in other countries, in the replacement market in Japan. The other company sells Goodyear-brand and Dunlop-brand tires to original equipment manufacturers in Japan. Goodyear’s 25% share of the net income or loss of these companies is reported as an increase or decrease to the operating income of Asia Tire using the equity method of accounting.

Engineered Products

          Another Goodyear business is the development, manufacture, distribution and sale of numerous rubber and thermoplastic products worldwide (“Engineered Products”). The products and services offered by Engineered Products include:

	•		belts and hose for motor vehicles.
	•		air springs, engine mounts and chassis parts for motor vehicles.
	•		conveyor and power transmission belts.
	•		air, water, steam, hydraulic, petroleum, fuel, chemical and materials handling hose for industrial applications.
	•		tank tracks.
	•		miscellaneous products and services.

Engineered Products manufactures products at nine plants located in the United States and 15 plants located in Australia, Brazil, Canada, Chile, China, Mexico, Slovenia, South Africa and Venezuela.

          The sales and operating income of Engineered Products for the periods indicated were:

ENGINEERED PRODUCTS SALES AND OPERATING INCOME

The percentages of Goodyear’s consolidated net sales and operating income attributable to Engineered Products for periods indicated were:

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Markets and Other Information

          Engineered Products sells its products to manufacturers of vehicles and various industrial products and to independent wholesale distributors. Approximately 14.8% (13.0% in 2000 and 12.4% in 1999) of Engineered Products sales are made to various industrial and transportation markets for replacement purposes.

          More than 50 major firms participate in the various markets served by Engineered Products. There are several suppliers of automotive belts and hose products, air springs, engine mounts and other rubber components for motor vehicles. Goodyear is a significant supplier of these products. Goodyear also is a leading supplier of conveyor and power transmission belts and industrial hose products. The principal competitors of Engineered Products include Dana, Mark IV, Gates, Dayco, Bridgestone/Firestone, Conti-Tech, Trelleborg, Tokai/DTR, Unipoly and Habasit.

          These markets are highly competitive, with quality, service and price being the most significant factors to most customers. Goodyear believes the products offered by Engineered Products are generally considered to be high quality and competitive in price and performance.

          During 2001, Engineered Product’s ten largest customers accounted for approximately 31.3% of its sales (32.2% in 2000 and 41.3% in 1999) and no customer, or group of affiliated customers, accounted for more than 6.7% (6.7% in 2000 and 11.7% in 1999) of its sales. The principal customers of Engineered Products include DaimlerChrysler, Ford, General Motors, International Truck and Engine, AutoZone, the United States Government and Applied Industrial.

          The business of Engineered Products is not seasonal to any significant degree. Engineered Products does not maintain a significant inventory or require an unusual amount of working capital when considered in relation to the volume of business transacted.

Chemical Products

          Another Goodyear business is the development, manufacture, distribution and sale of synthetic rubber and rubber latices, various resins and organic chemicals used in rubber and plastic processing, and other chemical products for industrial customers worldwide (“Chemical Products”). Chemical Products owns and operates four manufacturing facilities, a natural rubber plantation and processing facility in Indonesia and conducts natural rubber purchasing operations.

          The sales and operating income of Chemical Products during the periods indicated were:

CHEMICAL PRODUCTS SALES AND OPERATING INCOME

          The percentages of Goodyear’s consolidated net sales and operating income attributable to Chemical Products (which includes sales and operating income in respect of products transferred to Goodyear’s other segments), and to the sales of Chemical Products to Goodyear’s other segments, for the periods indicated were:

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          The major portion approximately 50.0%, 50.0% and 52.0% in 2001, 2000 and 1999, respectively, of the revenues of Chemical Products were sales to Goodyear’s other segments, primarily synthetic rubber and rubber processing chemicals to North American Tire, on a formula price basis. All production is in the United States.

Markets and Other Information

          The Tire Segments purchase approximately 70% of the synthetic rubber, and a significant portion of the rubber processing chemicals, produced by Chemical Products. All of the natural rubber produced by Goodyear’s plantation and processing facility is used by Goodyear. All external sales of rubber processing and other chemical products are made directly to manufacturers of various products.

          Several major firms are significant suppliers of one or more chemical products similar to those manufactured by Goodyear. The principal competitors of Chemical Products include Bayer, Dow and Ameripol Synpol. The markets are highly competitive, with product quality and price being the most significant factors to most customers. Goodyear believes the products offered by Chemical Products are generally considered to be high quality and competitive in price.

          During 2001, the ten largest unaffiliated customers of Chemical Products accounted for approximately 14.8% (14.9% in 2000 and 12.1% in 1999) of its sales. No unaffiliated customer accounted for more than 3.7% of its 2001 sales (4.1% in 2000 and 2.2% in 1999). The Chemical Products business is not seasonal to any significant degree and does not require an unusual amount of inventory or working capital relative to the volume of business transacted.

GENERAL BUSINESS INFORMATION

Sources and Availability of Raw Materials

          The principal raw materials used by Goodyear are synthetic and natural rubber. Goodyear purchases substantially all of its requirements for natural rubber in the world market. Synthetic rubber accounted for approximately 52%, 53%, and 54% of all rubber consumed by Goodyear worldwide during 2001, 2000 and 1999, respectively. Goodyear’s plants located in Beaumont and Houston, Texas, supply the major portion of its synthetic rubber requirements in the United States. Substantially all of the synthetic rubber used by Goodyear outside the United States is supplied by third parties. The principal raw materials used in the production of synthetic rubber are butadiene and styrene purchased from independent suppliers and isoprene purchased from independent suppliers or produced by Goodyear from purchased materials.

          Nylon and polyester yarns are used by Goodyear, substantial quantities of which are processed in Goodyear’s textile mills. Significant quantities of steel wire are used for radial tires, a portion of which is produced by Goodyear. Other important raw materials used by Goodyear are carbon black, pigments, chemicals and bead wire. Substantially all of these raw materials are purchased from independent suppliers, except for certain chemicals which Goodyear manufactures. Goodyear purchases most of the raw materials it uses in significant quantities from several suppliers, except in those instances where only one or a few qualified sources are available. As in 2001, Goodyear anticipates the continued availability of all raw materials it will require during 2002, subject to possible spot shortages.

          Substantial quantities of hydrocarbon based chemicals and fuels are used in the production of tires and other rubber products, synthetic rubber, latex and other products. Supplies of chemicals and fuels have been and are expected to continue to be available to Goodyear in quantities sufficient to satisfy the anticipated requirements of its manufacturing plants, subject to possible spot shortages.

          In the aggregate, the costs of natural rubber and other raw materials during 2001 decreased approximately .78% from 2000 levels. Although natural rubber and crude oil prices decreased

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slightly in the world market in late 2001 reflecting reduced global demand, Goodyear anticipates that the cost of energy will remain at year-end 2001 levels or increase slightly during 2002. Raw materials prices are expected to remain at year-end 2001 levels or decrease somewhat during 2002. Prices for most raw materials and fuels may fluctuate significantly during 2002.

Patents and Trademarks

          Goodyear owns approximately 2,196 patents issued by the United States Patent Office and approximately 5,928 patents issued or granted in other countries around the world. Goodyear also has licenses under numerous patents of others, covering various improvements in the design and manufacture of its products and in processes and equipment for the manufacture of its products. Goodyear also has approximately 724 applications for United States Patents pending and approximately 5,077 patent applications on file in other countries around the world. While such patents, patent applications and licenses as a group are of material importance to Goodyear, it does not consider any one patent, patent application or license, or any related group of them, to be of such importance that the loss or expiration thereof would materially affect Goodyear or any segment.

          Goodyear owns or controls and uses approximately 1,460 different trademarks, including several using the word “Goodyear” or the word “Dunlop.” These trademarks are protected by approximately 8,760 registrations and 1,050 pending applications worldwide. While Goodyear believes such trademarks as a group are of importance, the only trademarks Goodyear considers material to its business or to the business of any of its segments are those using the word “Goodyear”. Goodyear believes all of its significant trademarks are valid and will have unlimited duration as long as they are adequately protected and appropriately used.

Backlog

          Goodyear does not consider its backlog of orders to be material to, or a significant factor in, evaluating and understanding any of its segments or its businesses considered as a whole.

Government Business

          The percentages of Goodyear’s net sales under contracts or subcontracts subject to termination at the election of the United States government in the years indicated were:

Research and Development

          Goodyear expends significant amounts each year on research for the development of new, and the improvement of existing, products and manufacturing processes and equipment. Goodyear maintains substantial research and development centers for tires and related products in Akron, Ohio, and Colmar-Berg, Luxembourg; and tire proving grounds in Akron, Ohio, Huntsville, Alabama, San Angelo, Texas, Mireval, France, and Colmar-Berg, Luxembourg. Goodyear operates significant research and development facilities for other products in Akron, Ohio, Green, Ohio, Lincoln, Nebraska and Marysville, Ohio.

          Direct and indirect expenditures by Goodyear on research, development and certain engineering activities relating to the design, development, improvement and modification of new and existing products and services and the formulation and design of new, and improvements to existing, manufacturing processes and equipment during the periods indicated were:

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Goodyear expects to expend approximately $375 million for research and development activities during 2002.

Employees

          At December 31, 2001, Goodyear employed approximately 96,430 people throughout the world. Approximately 38,737 persons were employed by Goodyear in the United States at December 31, 2001. Approximately 11,818 of our employees were covered by a master collective bargaining agreement, dated May 9, 1997 (as supplemented in 2000), with the United Steel Workers of America, A.F.L.-C.I.O.-C.L.C. (“USWA”), which agreement will expire on April 19, 2003. Approximately 9,763 Goodyear employees were covered by other contracts with the USWA and various other unions. The major portion of Goodyear’s employees in Europe and Latin America are represented by unions.

Compliance with Environmental Regulations

          Goodyear is subject to extensive regulation under environmental and occupational health and safety laws and regulations. These laws and regulations relate to, among other things, air emissions, discharges to surface and underground waters and the generation, handling, storage, transportation and disposal of waste materials and hazardous substances. Goodyear has several continuing programs designed to ensure its compliance with Federal, state and local environmental and occupational safety and health laws and regulations.

          Goodyear’s expenditures relating to environmental improvement and occupational safety and health compliance projects in respect of its facilities worldwide during the periods indicated were: