Financial Data and Key Metrics Changes - Second quarter sales were $4.5 billion, down 2% from last year due to lower volume and the sale of OTR, partly offset by increases in price mix [22][23] - Unit volume declined 5%, reflecting the impacts of global trade disruption on OE production and consumer sell-out trends [22][23] - Gross margin declined by 360 basis points, while SG&A costs were lower by $39 million [22][23] Business Line Data and Key Metrics Changes - The commercial business experienced a significant decline, with OEM replacement demand globally being materially weaker, contributing to about half of the sales miss [22][23] - The Americas unit volume decreased by 2.6%, driven by headwinds in consumer OE and replacement, while commercial OE volume declined by 22% [27][28] - EMEA's unit volume decreased by 2%, with significant weakness in the commercial business, while consumer OE volume grew by 11% [30][31] Market Data and Key Metrics Changes - The consumer replacement market in the U.S. was characterized by increased competition, particularly with low-end imports growing approximately 15% during the quarter [12][27] - Non-member imports in the U.S. increased over 30% in the quarter, while European imports also rose [18][28] - The truck tire market has been running at recessionary levels, with expectations for full-year volume and mix to register below COVID year levels [17][33] Company Strategy and Development Direction - The company is focused on executing the Goodyear Forward strategy, which aims to control costs and improve margins, with benefits already being realized ahead of schedule [6][8] - New product launches are planned, including 11 new products in North America and an extensive winter tire offering in Europe, aimed at gaining share in the premium segment [20][52] - The company is committed to strengthening its balance sheet through divestitures and cost control measures [8][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the near-term outlook remains turbulent due to global trade disruptions but expressed confidence in regaining momentum as market conditions stabilize [5][19] - The company expects to see benefits from raw material costs beginning in Q4 and anticipates a decline in imports in the U.S. market [9][16] - Management highlighted the importance of adapting to changes in the market, including potential tariffs in Europe and the need to manage distribution effectively [16][19] Other Important Information - The company reported a net income increase to $254 million, driven by a gain on the sale of the Dunlop brand, despite rationalization charges of $59 million impacting results [23][24] - Free cash flow was stable versus last year, with significant proceeds from asset sales contributing positively [26][82] - The company expects to receive gross proceeds of $650 million from the sale of its Chemical business later this year [26] Q&A Session Summary Question: Impact of low-cost imports on key markets - Management clarified that there was a surge in imports across key markets, particularly in the U.S. and Europe, despite tariffs being in place [44][45] Question: Contribution of price versus mix - Management indicated that pricing actions implemented in May are effective, but commercial truck mix has been a significant offset [48][50] Question: Future SOI impact from commercial vehicle headwinds - Management expects continued headwinds from commercial truck mix but anticipates adjustments in production to mitigate impacts [61][62] Question: Mitigation efforts for increasing tariffs - Management confirmed that adjustments to the supply chain are being considered to limit tariff impacts on the P&L [66][67] Question: Disruption from exiting ATD - Management noted that the transition to new distributors has been largely successful, with 95% of the retail base making the switch [74][75] Question: Full-year outlook on SOI and free cash flow - Management provided insights on expected drivers for Q4, including favorable raw materials and Goodyear Forward benefits, but noted uncertainty in volume [80][82]