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Goodyear Launches New Racing Tire

Zacks Equity Research

Goodyear Tire & Rubber Company (GT) utilized its street technology in the racing field to create the newly-designed Eagle race tire. These tires will be used in vehicles participating in the NASCAR Sprint Cup and Nationwide Series races at Atlanta Motor Speedway. This new tire is based on the technology used in consumer tires.

Making tires for the Atlanta speedway was a challenge for Goodyear as its rough track surface leads to higher wear and tear whereas its length and layout encourages high speed.

The new right-side tire designed for the Atlanta speedway incorporates the Multi-Zone Tread Technology. This technology fuses two different rubber compounds in a single tread to provide both traction and durability, which helps to serve the NASCAR speedways.

The technology was incorporated from Goodyear's Assurance TripleTred All-Season passenger tire, which initiated the concept of multiple tread zones in auto tires. It features three separate zones to provide enhanced traction in wet, icy and dry conditions.

Before this, Goodyear used street technology in racing tires in the NASCAR Nationwide Series that featured the wet weather radial from the Goodyear Eagle F1 All Season tire. With the newly designed tire, the Goodyear has deployed street technology to the racing track for the second time.

Recently, Cooper Tire & Rubber Co. (CTB) announced that its latest product Discoverer HT3 tire family is now available with dealers across the country. Discoverer HT3 is a smart option for business owners and occupies about 96% of the light truck highway market share.

Cooper’s Discoverer HT3 tire is equipped with modern technology such as silica infused tread compound and full depth 3D micro-gauge siping. This helps in improving the performance of the truck on highways. Discoverer HT3 also features a continuous shoulder rib, which provides better resistance to irregular wear and ensures less noise during a ride.

Goodyear Tire & Rubber Company is one of the largest tire manufacturing companies worldwide, selling its products under the Goodyear, Kelly, Dunlop, Fulda, Debica, Sava and various other “house” brand names as well as private-label brands.

Goodyear expects full-year tire unit volume to be flat compared with 2012. The company expects unit volume to increase 3% to 5% in the third quarter of 2013 due to improvements in emerging markets and recovery in mature markets. Currently, the company retains a Zacks Rank #1 (Strong Buy).

Stocks that are worth looking for in the same industry include Gentex Corp. (GNTX) and American Axle & Manufacturing Holdings Inc. (AXL). Both carry a Zacks Rank #1 (Strong Buy).

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