Consolidating Financial Information

3 Months Ended

Mar. 31, 2017

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 $700 million outstanding principal amount of 7% senior notes due 2022, the $1.0 billion outstanding principal amount of 5.125% senior notes due 2023, the $900 million outstanding principal amount of 5% senior notes due 2026 and the $700 million outstanding principal amount of 4.875% senior notes due 2027 (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 capital stock, loans and other capital transactions between members of the consolidated group. During the first quarter of 2017, one of our guarantor subsidiaries merged with the Parent Company.  We have changed the prior year consolidating financial statements to conform to the current structure.  As a result, Parent Company Total Assets decreased $113 million and Guarantor Subsidiaries Total Assets decreased $358 million, with corresponding offsetting adjustments presented on the same line items in the Consolidating Entries and Eliminations column, as of December 31, 2016. In addition, Parent Company Total Liabilities decreased $113 million, Guarantor Subsidiaries Total Liabilities decreased $46 million and Guarantor Subsidiaries Total Shareholders' Equity decreased $312 million, with corresponding offsetting adjustments presented on the same line items in the Consolidating Entries and Eliminations column, as of December 31, 2016. Furthermore, Net Income increased $6 million for Guarantor Subsidiaries, with corresponding offsetting adjustments presented on the same line items in the Consolidating Entries and Eliminations column, for the three months ended March 31, 2016. The change did not impact the Non-Guarantor Subsidiaries presentation in the previously issued consolidating financial statements.

During the first quarter of 2017, we revised the presentation of eliminations of certain intercompany transactions solely between Non-Guarantor Subsidiaries within the consolidating statement of operations for the three months ended March 31, 2016. The revision did not impact the presentation of amounts in previously issued consolidating financial statements for the Parent Company or Guarantor Subsidiaries columns, nor did it impact amounts previously reported in the Company's Consolidated Statements of Operations. Certain eliminations solely between Non-Guarantor Subsidiaries that were previously presented within the Consolidating Entries and Eliminations column are now presented within the Non-Guarantor Subsidiaries column. Under the prior presentation, the Non-Guarantor Subsidiaries column in the consolidating statement of operations was $292 million lower for both Net Sales and Cost of Goods Sold with corresponding offsetting adjustments presented on the same line items in the Consolidating Entries and Eliminations column. We do not consider these changes in presentation to be material to any previously issued financial statements as the primary purpose of this disclosure is to provide our noteholders with visibility into the entities that provide guarantees in support of the notes, which is disclosed in the Parent Company and Guarantor Subsidiaries columns which are not affected by the revisions described above.

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, 2017
(In millions)	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Assets:
Current Assets:
Cash and Cash Equivalents	$	118	$	25	$	818	$	—		$	961
Accounts Receivable, net	629		119		1,522		—			2,270
Accounts Receivable From Affiliates	—		232		—		(232		)	—
Inventories	1,569		34		1,264		(22		)	2,845
Prepaid Expenses and Other Current Assets	85		1		161		2			249
Total Current Assets	2,401		411		3,765		(252		)	6,325
Goodwill	24		—		399		122			545
Intangible Assets	117		—		19		—			136
Deferred Income Taxes	1,962		31		378		—			2,371
Other Assets	223		53		402		4			682
Investments in Subsidiaries	4,527		562		—		(5,089		)	—
Property, Plant and Equipment, net	2,490		343		4,328		(26		)	7,135
Total Assets	$	11,744	$	1,400	$	9,291	$	(5,241	)	$	17,194
Liabilities:
Current Liabilities:
Accounts Payable-Trade	$	896	$	114	$	1,621	$	—		$	2,631
Accounts Payable to Affiliates	66		—		166		(232		)	—
Compensation and Benefits	336		16		216		—			568
Other Current Liabilities	386		2		654		(2		)	1,040
Notes Payable and Overdrafts	—		—		217		—			217
Long Term Debt and Capital Leases Due Within One Year	5		—		453		1			459
Total Current Liabilities	1,689		132		3,327		(233		)	4,915
Long Term Debt and Capital Leases	4,290		—		967		—			5,257
Compensation and Benefits	622		98		672		—			1,392
Deferred Income Taxes	—		1		85		—			86
Other Long Term Liabilities	410		11		162		1			584
Total Liabilities	7,011		242		5,213		(232		)	12,234
Commitments and Contingent Liabilities
Shareholders’ Equity:
Goodyear Shareholders’ Equity:
Common Stock	252		—		—		—			252
Other Equity	4,481		1,158		3,851		(5,009		)	4,481
Goodyear Shareholders’ Equity	4,733		1,158		3,851		(5,009		)	4,733
Minority Shareholders’ Equity — Nonredeemable	—		—		227		—			227
Total Shareholders’ Equity	4,733		1,158		4,078		(5,009		)	4,960
Total Liabilities and Shareholders’ Equity	$	11,744	$	1,400	$	9,291	$	(5,241	)	$	17,194

	Condensed Consolidating Balance Sheet
	December 31, 2016
(In millions)	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Assets:
Current Assets:
Cash and Cash Equivalents	$	188	$	55	$	889	$	—		$	1,132
Accounts Receivable, net	589		106		1,074		—			1,769
Accounts Receivable From Affiliates	—		277		270		(547		)	—
Inventories	1,443		25		1,178		(19		)	2,627
Prepaid Expenses and Other Current Assets	57		3		130		—			190
Total Current Assets	2,277		466		3,541		(566		)	5,718
Goodwill	24		—		391		120			535
Intangible Assets	118		—		18		—			136
Deferred Income Taxes	2,010		31		373		—			2,414
Other Assets	223		53		387		5			668
Investments in Subsidiaries	4,344		541		—		(4,885		)	—
Property, Plant and Equipment, net	2,481		308		4,279		(28		)	7,040
Total Assets	$	11,477	$	1,399	$	8,989	$	(5,354	)	$	16,511
Liabilities:
Current Liabilities:
Accounts Payable-Trade	$	905	$	142	$	1,542	$	—		$	2,589
Accounts Payable to Affiliates	547		—		—		(547		)	—
Compensation and Benefits	365		15		204		—			584
Other Current Liabilities	355		—		611		(3		)	963
Notes Payable and Overdrafts	—		—		245		—			245
Long Term Debt and Capital Leases Due Within One Year	6		—		430		—			436
Total Current Liabilities	2,178		157		3,032		(550		)	4,817
Long Term Debt and Capital Leases	3,685		—		1,113		—			4,798
Compensation and Benefits	682		98		680		—			1,460
Deferred Income Taxes	—		1		84		—			85
Other Long Term Liabilities	425		12		188		1			626
Total Liabilities	6,970		268		5,097		(549		)	11,786
Commitments and Contingent Liabilities
Shareholders’ Equity:
Goodyear Shareholders’ Equity:
Common Stock	252		—		—		—			252
Other Equity	4,255		1,131		3,674		(4,805		)	4,255
Goodyear Shareholders’ Equity	4,507		1,131		3,674		(4,805		)	4,507
Minority Shareholders’ Equity — Nonredeemable	—		—		218		—			218
Total Shareholders’ Equity	4,507		1,131		3,892		(4,805		)	4,725
Total Liabilities and Shareholders’ Equity	$	11,477	$	1,399	$	8,989	$	(5,354	)	$	16,511

	Consolidating Statements of Operations
	Three Months Ended March 31, 2017
(In millions)	Parent Company			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Net Sales	$	1,767		$	299	$	2,302		$	(669	)	$	3,699
Cost of Goods Sold	1,380			274		1,796			(685		)	2,765
Selling, Administrative and General Expense	259			9		312			(1		)	579
Rationalizations	1			—		28			—			29
Interest Expense	65			2		31			(11		)	87
Other (Income) Expense	(19		)	2		(4		)	21			—
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	81			12		139			7			239
United States and Foreign Taxes	43			3		29			(5		)	70
Equity in Earnings of Subsidiaries	128			15		—			(143		)	—
Net Income (Loss)	166			24		110			(131		)	169
Less: Minority Shareholders’ Net Income	—			—		3			—			3
Goodyear Net Income (Loss)	$	166		$	24	$	107		$	(131	)	$	166
Comprehensive Income (Loss)	$	261		$	28	$	194		$	(213	)	$	270
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—		9			—			9
Goodyear Comprehensive Income (Loss)	$	261		$	28	$	185		$	(213	)	$	261

	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	$	1,787		$	314		$	2,256		$	(666	)	$	3,691
Cost of Goods Sold	1,330			295			1,777			(701		)	2,701
Selling, Administrative and General Expense	270			10			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	121			5			120			21			267
United States and Foreign Taxes	56			(3		)	26			(1		)	78
Equity in Earnings of Subsidiaries	119			20			—			(139		)	—
Net Income (Loss)	184			28			94			(117		)	189
Less: Minority Shareholders’ Net Income	—			—			5			—			5
Goodyear Net Income (Loss)	$	184		$	28		$	89		$	(117	)	$	184
Comprehensive Income (Loss)	$	244		$	13		$	155		$	(156	)	$	256
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			12			—			12
Goodyear Comprehensive Income (Loss)	$	244		$	13		$	143		$	(156	)	$	244

	Condensed Consolidating Statement of Cash Flows
	Three Months Ended March 31, 2017
(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	$	(81	)	$	(4	)	$	(191	)	$	(10	)	$	(286	)
Cash Flows from Investing Activities:
Capital Expenditures	(113		)	(49		)	(109		)	—			(271		)
Asset Dispositions	1			—			—			—			1
Short Term Securities Acquired	—			—			(11		)	—			(11		)
Short Term Securities Redeemed	—			—			11			—			11
Capital Contributions and Loans Incurred	(23		)	—			(30		)	53			—
Capital Redemptions and Loans Paid	—			—			448			(448		)	—
Total Cash Flows from Investing Activities	(135		)	(49		)	309			(395		)	(270		)
Cash Flows from Financing Activities:
Short Term Debt and Overdrafts Incurred	—			—			51			—			51
Short Term Debt and Overdrafts Paid	—			—			(82		)	—			(82		)
Long Term Debt Incurred	1,270			—			568			—			1,838
Long Term Debt Paid	(655		)	—			(714		)	—			(1,369		)
Common Stock Issued	9			—			—			—			9
Common Stock Repurchased	(25		)	—			—			—			(25		)
Common Stock Dividends Paid	(25		)	—			—			—			(25		)
Capital Contributions and Loans Incurred	30			23			—			(53		)	—
Capital Redemptions and Loans Paid	(448		)	—			—			448			—
Intercompany Dividends Paid	—			—			(10		)	10			—
Debt Related Costs and Other Transactions	12			—			(11		)	—			1
Total Cash Flows from Financing Activities	168			23			(198		)	405			398
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash	—			—			20			—			20
Net Change in Cash, Cash Equivalents and Restricted Cash	(48		)	(30		)	(60		)	—			(138		)
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period	210			55			924			—			1,189
Cash, Cash Equivalents and Restricted Cash at End of the Period	$	162		$	25		$	864		$	—		$	1,051

	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	$	(315	)	$	2		$	(43	)	$	(16	)	$	(372	)
Cash Flows from Investing Activities:
Capital Expenditures	(116		)	(16		)	(123		)	2			(253		)
Asset Dispositions	—			—			1			—			1
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	(125		)	(16		)	(234		)	111			(264		)
Cash Flows from Financing Activities:
Short Term Debt and Overdrafts Incurred	—			—			26			—			26
Short Term Debt and Overdrafts Paid	—			—			(2		)	—			(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		)	—			(12		)	3			(10		)
Total Cash Flows from Financing Activities	301			(25		)	23			(95		)	204
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash	—			2			26			—			28
Net Change in Cash, Cash Equivalents and Restricted Cash	(139		)	(37		)	(228		)	—			(404		)
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period	361			67			1,074			—			1,502
Cash, Cash Equivalents and Restricted Cash at End of the Period	$	222		$	30		$	846		$	—		$	1,098