Consolidating Financial Information

3 Months Ended

Mar. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

CONSOLIDATING FINANCIAL INFORMATION

CONSOLIDATING FINANCIAL INFORMATION

Certain of our subsidiaries have guaranteed our obligations under the $282 million outstanding principal amount of 8.75% notes due 2020, the $900 million outstanding principal amount of 6.5% senior notes due 2021, the $700 million outstanding principal amount of 7% senior notes due 2022 and the $1.0 billion outstanding principal amount of 5.125% senior notes due 2023 (collectively, the “notes”). The following presents the condensed consolidating financial information separately for:

(i) The Goodyear Tire & Rubber Company (the “Parent Company”), the issuer of the guaranteed obligations;

(ii) Guarantor Subsidiaries, on a combined basis, as specified in the indentures related to Goodyear’s obligations under the notes;

(iii) Non-guarantor Subsidiaries, on a combined basis;

(iv) Consolidating entries and eliminations representing adjustments to (a) eliminate intercompany transactions between the Parent Company, the Guarantor Subsidiaries and the Non-guarantor Subsidiaries, (b) eliminate the investments in our subsidiaries, and (c) record consolidating entries; and

(v) The Goodyear Tire & Rubber Company and Subsidiaries on a consolidated basis.

Each guarantor subsidiary is 100% owned by the Parent Company at the date of each balance sheet presented. The notes are fully and unconditionally guaranteed on a joint and several basis by each guarantor subsidiary. The guarantees of the guarantor subsidiaries are subject to release in limited circumstances only upon the occurrence of certain customary conditions. Each entity in the consolidating financial information follows the same accounting policies as described in the consolidated financial statements, except for the use by the Parent Company and guarantor subsidiaries of the equity method of accounting to reflect ownership interests in subsidiaries which are eliminated upon consolidation. Changes in intercompany receivables and payables related to operations, such as intercompany sales or service charges, are included in cash flows from operating activities. Intercompany transactions reported as investing or financing activities include the sale of the capital stock of various subsidiaries, loans and other capital transactions between members of the consolidated group. In 2015, the Parent Company acquired the common shares of a non-guarantor subsidiary from another non-guarantor subsidiary at a cost of $145 million. The transaction was settled by the cancellation of intercompany balances between the Parent Company and the transferring non-guarantor subsidiary. In addition, in 2015 the Parent Company capitalized approximately $90 million of intercompany receivables from a non-guarantor subsidiary with a corresponding increase in equity of the subsidiary.

Certain non-guarantor subsidiaries of the Parent Company are limited in their ability to remit funds to it by means of dividends, advances or loans due to required foreign government and/or currency exchange board approvals or limitations in credit agreements or other debt instruments of those subsidiaries.

	Condensed Consolidating Balance Sheet
	March 31, 2016
(In millions)	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Assets:
Current Assets:
Cash and Cash Equivalents	$	216	$	32	$	831	$	—		$	1,079
Accounts Receivable	762		154		1,566		—			2,482
Accounts Receivable From Affiliates	—		557		—		(557		)	—
Inventories	1,333		156		1,188		(41		)	2,636
Prepaid Expenses and Other Current Assets	44		5		124		5			178
Total Current Assets	2,355		904		3,709		(593		)	6,375
Goodwill	—		24		423		127			574
Intangible Assets	118		—		20		—			138
Deferred Income Taxes	1,978		19		77		—			2,074
Other Assets	211		88		370		7			676
Investments in Subsidiaries	4,229		429		—		(4,658		)	—
Property, Plant and Equipment	2,374		234		4,358		(26		)	6,940
Total Assets	$	11,265	$	1,698	$	8,957	$	(5,143	)	$	16,777
Liabilities:
Current Liabilities:
Accounts Payable-Trade	$	900	$	154	$	1,599	$	—		$	2,653
Accounts Payable to Affiliates	346		—		211		(557		)	—
Compensation and Benefits	350		30		235		—			615
Other Current Liabilities	319		19		613		(8		)	943
Notes Payable and Overdrafts	—		—		76		—			76
Long Term Debt and Capital Leases Due Within One Year	6		—		308		—			314
Total Current Liabilities	1,921		203		3,042		(565		)	4,601
Long Term Debt and Capital Leases	4,067		—		1,618		—			5,685
Compensation and Benefits	674		101		662		—			1,437
Deferred Income Taxes	—		1		86		—			87
Other Long Term Liabilities	499		11		125		—			635
Total Liabilities	7,161		316		5,533		(565		)	12,445
Commitments and Contingent Liabilities
Shareholders’ Equity:
Goodyear Shareholders’ Equity:
Common Stock	266		—		—		—			266
Other Equity	3,838		1,382		3,196		(4,578		)	3,838
Goodyear Shareholders’ Equity	4,104		1,382		3,196		(4,578		)	4,104
Minority Shareholders’ Equity — Nonredeemable	—		—		228		—			228
Total Shareholders’ Equity	4,104		1,382		3,424		(4,578		)	4,332
Total Liabilities and Shareholders’ Equity	$	11,265	$	1,698	$	8,957	$	(5,143	)	$	16,777

	Condensed Consolidating Balance Sheet
	December 31, 2015
(In millions)	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Assets:
Current Assets:
Cash and Cash Equivalents	$	354	$	70	$	1,052	$	—		$	1,476
Accounts Receivable	814		136		1,083		—			2,033
Accounts Receivable From Affiliates	—		609		—		(609		)	—
Inventories	1,199		157		1,152		(44		)	2,464
Prepaid Expenses and Other Current Assets	42		3		105		3			153
Total Current Assets	2,409		975		3,392		(650		)	6,126
Goodwill	—		24		407		124			555
Intangible Assets	118		—		20		—			138
Deferred Income Taxes	2,049		19		73		—			2,141
Other Assets	216		81		350		7			654
Investments in Subsidiaries	4,088		383		—		(4,471		)	—
Property, Plant and Equipment	2,377		216		4,213		(29		)	6,777
Total Assets	$	11,257	$	1,698	$	8,455	$	(5,019	)	$	16,391
Liabilities:
Current Liabilities:
Accounts Payable-Trade	$	1,002	$	189	$	1,578	$	—		$	2,769
Accounts Payable to Affiliates	540		—		69		(609		)	—
Compensation and Benefits	411		29		226		—			666
Other Current Liabilities	328		16		547		(5		)	886
Notes Payable and Overdrafts	—		—		49		—			49
Long Term Debt and Capital Leases Due Within One Year	6		—		579		—			585
Total Current Liabilities	2,287		234		3,048		(614		)	4,955
Long Term Debt and Capital Leases	3,796		—		1,278		—			5,074
Compensation and Benefits	725		97		646		—			1,468
Deferred Income Taxes	—		1		92		(2		)	91
Other Long Term Liabilities	529		15		119		(2		)	661
Total Liabilities	7,337		347		5,183		(618		)	12,249
Commitments and Contingent Liabilities
Shareholders’ Equity:
Goodyear Shareholders’ Equity:
Common Stock	267		—		—		—			267
Other Equity	3,653		1,351		3,050		(4,401		)	3,653
Goodyear Shareholders’ Equity	3,920		1,351		3,050		(4,401		)	3,920
Minority Shareholders’ Equity — Nonredeemable	—		—		222		—			222
Total Shareholders’ Equity	3,920		1,351		3,272		(4,401		)	4,142
Total Liabilities and Shareholders’ Equity	$	11,257	$	1,698	$	8,455	$	(5,019	)	$	16,391

	Consolidating Statements of Operations
	Three Months Ended March 31, 2016
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Net Sales	$	1,684		$	434		$	1,964		$	(391	)	$	3,691
Cost of Goods Sold	1,233			393			1,485			(410		)	2,701
Selling, Administrative and General Expense	242			38			336			(1		)	615
Rationalizations	2			—			9			—			11
Interest Expense	68			3			31			(11		)	91
Other (Income) Expense	(4		)	1			(17		)	26			6
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	143			(1		)	120			5			267
United States and Foreign Taxes	56			(3		)	26			(1		)	78
Equity in Earnings of Subsidiaries	97			20			—			(117		)	—
Net Income (Loss)	184			22			94			(111		)	189
Less: Minority Shareholders’ Net Income (Loss)	—			—			5			—			5
Goodyear Net Income (Loss)	$	184		$	22		$	89		$	(111	)	$	184
Comprehensive Income (Loss)	$	244		$	7		$	155		$	(150	)	$	256
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			12			—			12
Goodyear Comprehensive Income (Loss)	$	244		$	7		$	143		$	(150	)	$	244

	Consolidating Statements of Operations
	Three Months Ended March 31, 2015
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Net Sales	$	1,840		$	520		$	2,602		$	(938	)	$	4,024
Cost of Goods Sold	1,443			472			2,103			(952		)	3,066
Selling, Administrative and General Expense	226			40			344			(2		)	608
Rationalizations	—			—			16			—			16
Interest Expense	83			6			31			(13		)	107
Other (Income) Expense	(165		)	(15		)	11			37			(132		)
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	253			17			97			(8		)	359
United States and Foreign Taxes	87			5			30			1			123
Equity in Earnings of Subsidiaries	58			7			—			(65		)	—
Net Income (Loss)	224			19			67			(74		)	236
Less: Minority Shareholders’ Net Income (Loss)	—			—			12			—			12
Goodyear Net Income (Loss)	$	224		$	19		$	55		$	(74	)	$	224
Comprehensive Income (Loss)	$	193		$	34		$	(62	)	$	(22	)	$	143
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			(29		)	(21		)	(50		)
Goodyear Comprehensive Income (Loss)	$	193		$	34		$	(33	)	$	(1	)	$	193

	Condensed Consolidating Statement of Cash Flows
	Three Months Ended March 31, 2016
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Cash Flows from Operating Activities:
Total Cash Flows from Operating Activities	$	(316	)	$	3		$	(52	)	$	(16	)	$	(381	)
Cash Flows from Investing Activities:
Capital Expenditures	(113		)	(19		)	(123		)	2			(253		)
Asset Dispositions	—			—			1			—			1
Decrease in Restricted Cash	—			—			7			—			7
Short Term Securities Acquired	—			—			(12		)	—			(12		)
Capital Contributions and Loans Incurred	(34		)	—			(100		)	134			—
Capital Redemptions and Loans Paid	25			—			—			(25		)	—
Total Cash Flows from Investing Activities	(122		)	(19		)	(227		)	111			(257		)
Cash Flows from Financing Activities:
Short Term Debt and Overdrafts Incurred	—			1			26			(1		)	26
Short Term Debt and Overdrafts Paid	(1		)	—			(2		)	1			(2		)
Long Term Debt Incurred	320			—			765			—			1,085
Long Term Debt Paid	(51		)	—			(771		)	—			(822		)
Common Stock Issued	2			—			—			—			2
Common Stock Repurchased	(50		)	—			—			—			(50		)
Common Stock Dividends Paid	(19		)	—			—			—			(19		)
Capital Contributions and Loans Incurred	100			—			34			(134		)	—
Capital Redemptions and Loans Paid	—			(25		)	—			25			—
Intercompany Dividends Paid	—			—			(11		)	11			—
Transactions with Minority Interests in Subsidiaries	—			—			(6		)	—			(6		)
Debt Related Costs and Other Transactions	(1		)	—			(3		)	3			(1		)
Total Cash Flows from Financing Activities	300			(24		)	32			(95		)	213
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			2			26			—			28
Net Change in Cash and Cash Equivalents	(138		)	(38		)	(221		)	—			(397		)
Cash and Cash Equivalents at Beginning of the Period	354			70			1,052			—			1,476
Cash and Cash Equivalents at End of the Period	$	216		$	32		$	831		$	—		$	1,079

	Condensed Consolidating Statement of Cash Flows
	Three Months Ended March 31, 2015
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Cash Flows from Operating Activities:
Total Cash Flows from Operating Activities	$	(76	)	$	(33	)	$	(141	)	$	(12	)	$	(262	)
Cash Flows from Investing Activities:
Capital Expenditures	(60		)	(11		)	(136		)	3			(204		)
Asset Dispositions	—			—			1			—			1
Decrease in Restricted Cash	—			—			2			—			2
Short Term Securities Redeemed	—			—			21			—			21
Total Cash Flows from Investing Activities	(60		)	(11		)	(112		)	3			(180		)
Cash Flows from Financing Activities:
Short Term Debt and Overdrafts Incurred	14			7			16			(21		)	16
Short Term Debt and Overdrafts Paid	(7		)	—			(36		)	21			(22		)
Long Term Debt Incurred	141			—			475			—			616
Long Term Debt Paid	(341		)	—			(287		)	—			(628		)
Common Stock Issued	2			—			—			—			2
Common Stock Repurchased	(1		)	—			—			—			(1		)
Common Stock Dividends Paid	(16		)	—			—			—			(16		)
Intercompany Dividends Paid	—			—			(9		)	9			—
Transactions with Minority Interests in Subsidiaries	—			—			(1		)	—			(1		)
Total Cash Flows from Financing Activities	(208		)	7			158			9			(34		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			(7		)	(65		)	—			(72		)
Net Change in Cash and Cash Equivalents	(344		)	(44		)	(160		)	—			(548		)
Cash and Cash Equivalents at Beginning of the Period	674			89			1,398			—			2,161
Cash and Cash Equivalents at End of the Period	$	330		$	45		$	1,238		$	—		$	1,613