GOODYEAR TIRE & RUBBER CO /OH/ MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. (form 10-Q)

All per share amounts are diluted and refer to Goodyear net income.

OVERVIEW

The Goodyear Tire & Rubber Company is one of the world's leading manufacturers
of tires, with one of the most recognizable brand names in the world and
operations in most regions of the world. We have a broad global footprint with
57 manufacturing facilities in 23 countries, including the United States. We
operate our business through three operating segments representing our regional
tire businesses: Americas; Europe, Middle East and Africa ("EMEA"); and Asia
Pacific.

Results of Operations

During the second quarter and first six months of 2022, our operating results
significantly improved compared to 2021 despite a continued difficult
macroeconomic environment, including the strengthening of the U.S. dollar
against most foreign currencies, as we continue to realize the benefits of our
acquisition of Cooper Tire & Rubber Company ("Cooper Tire") on June 7, 2021 (the
"Closing Date"). While we experienced continued recovery from the impacts of the
COVID-19 pandemic, our results for the second quarter and first six months of
2022 were still negatively influenced by the direct and indirect macroeconomic
effects of the ongoing pandemic. Our global businesses are experiencing varying
stages of recovery, as ongoing national and local efforts in certain countries
to contain the spread of COVID-19 and its related variants, including renewed
stay-at-home orders and other restrictions on mobility, continue to impact
economic conditions. Increased demand for consumer products and supply chain
disruptions as a result of the pandemic and other global events, including port
congestion and container shortages, has led to inflationary cost pressures,
including higher costs for certain raw materials, higher transportation costs
and higher energy costs. Also, shortages of certain automobile parts, such as
semiconductors, continue to affect OE manufacturers' ability to produce consumer
and commercial vehicles consistently.

Currently, most of our global tire manufacturing facilities are operating at or
near full capacity to meet current demand, as well as to increase the level of
our finished goods inventory as we continue to restock in order to fulfill
anticipated near-term demand. Earlier in the second quarter of 2022, some of our
facilities, including our facilities in Pulandian and Kunshan, China, had to
temporarily shut down or limit production as a result of renewed stay-at-home
orders or other events. Additionally, we continue to experience increased
labor-related costs and manufacturing inefficiencies associated with the ongoing
tight labor supply, particularly in the U.S. Our decisions to change production
levels in the future will be based on an evaluation of market demand signals and
inventory and supply levels, as well as the availability of sufficient qualified
labor and our ability to continue to safeguard the health of our associates.

We continue to monitor the pandemic on a local basis, taking actions to protect
the health and wellbeing of our associates, customers and communities, which
remain our top priority. We also continue to follow guidance from the Centers
for Disease Control and Prevention, which include preventative measures at our
facilities, as appropriate.

On July 30, 2022, we reached a tentative agreement with the United Steelworkers
("USW") on a new four-year master labor contract covering nearly 5,900 workers
at four plants in the United States. The tentative agreement is subject to a
ratification vote by USW members at the plants covered by the contract.

While it remains challenging to operate our business in Ukraine, we were able to
resume shipments of tires into the country on a limited basis during the second
quarter of 2022. In addition, we previously suspended all shipments of tires to
Russia during the first quarter of 2022. Goodyear's sales in Ukraine and Russia
represented 0.3% and 1.2%, respectively, of our total 2021 net sales of $17.5
billion. We do not have manufacturing operations in either Ukraine or Russia,
and we continue to take numerous actions to ensure continuity of supply for raw
materials used in manufacturing, some of which are sourced from the impacted
area. These actions include increasing our safety stocks when possible,
identifying substitutes where appropriate and building alternate supplier
relationships where necessary. Nonetheless, the ongoing conflict has aggravated
the already challenging macroeconomic trends discussed above, including global
supply chain disruptions, higher costs for certain raw materials and higher
transportation and energy costs. The situation continues to be very dynamic, and
we are continually assessing all potential impacts on our associates and
business.

Our results for the second quarter of 2022 include a 21.5% increase in tire unit
shipments compared to 2021, reflecting the addition of the operating results of
Cooper Tire and continued recovery from the impacts of the COVID-19 pandemic. In
the second quarter of 2022, we incurred approximately $262 million of additional
costs related to inflation and other cost pressures, primarily higher
transportation and energy costs.

Net sales in the second quarter of 2022 were $5,212 million, compared to $3,979
million in the second quarter of 2021. Net sales increased in 2022 primarily due
to the addition of an incremental $663 million of net sales from Cooper Tire,
global improvements in price and product mix, higher tire volume in EMEA and
Asia Pacific, partially offset by lower tire volume in

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our legacy business in Americas, and higher sales in other tire-related
businesses, driven by higher aviation sales, primarily in Americas and EMEA,
increased retail sales in Americas and growth in EMEA's Fleet Solutions. These
increases were partially offset by unfavorable foreign currency translation,
primarily in EMEA, driven by the weakening of the euro and Turkish lira.

In the second quarter of 2022, Goodyear net income was $166 million, or $0.58
per share, compared to $67 million, or $0.27 per share, in the second quarter of
2021. The increase in Goodyear net income was primarily due to an increase in
Other Income driven by a one-time gain in the second quarter of 2022 for a sale
and leaseback transaction involving certain consumer and commercial retail
properties in Americas and higher segment operating income. These increases were
partially offset by higher U.S. and Foreign Tax Expense reflecting higher
pre-tax earnings and higher interest expense. Additionally, our results in the
second quarter of 2021 included the impact of a severe winter storm in the U.S.
estimated to negatively impact earnings by $27 million ($22 million after-tax
and minority).

Total segment operating income for the second quarter of 2022 was $364 million,
compared to $299 million in the second quarter of 2021. The increase was
primarily due to global improvements in price and product mix of $560 million,
which more than offset higher raw material costs of $419 million, higher tire
volume of $43 million in EMEA and Asia Pacific, partially offset by lower tire
volume in our legacy business in Americas, and increased earnings in other-tire
related businesses of $19 million, driven by higher aviation sales in Americas
and EMEA. These increases were partially offset by increased conversion costs of
$100 million, higher transportation and import duty costs of $58 million and
higher Selling, Administrative and General Expense ("SAG") of $37 million, all
driven by the inflationary cost trends discussed above, as well as a favorable
indirect tax ruling in Brazil of $69 million ($45 million after-tax and
minority) in 2021 related to prior periods and a favorable out of period
adjustment of $8 million ($6 million after-tax and minority) in 2021 related to
accrued freight charges in Americas. The remainder of the change was driven by
the addition of Cooper Tire's operating results. Refer to "Results of Operations
- Segment Information" for additional information.

Net sales in the first six months of 2022 were $10,120 million, compared to
$7,490 million in the first six months of 2021. Net sales increased in 2022
primarily due to the addition of an incremental $1,532 million of net sales from
Cooper Tire, global improvements in price and product mix, higher tire volume in
EMEA and Asia Pacific, partially offset by lower tire volume in our legacy
business in Americas, and higher sales in other tire-related businesses, driven
by increased third-party chemical sales in Americas, higher aviation sales,
primarily in Americas and EMEA, growth in EMEA's Fleet Solutions, and increased
retail sales in Americas. These increases were partially offset by unfavorable
foreign currency translation, primarily in EMEA, driven by the weakening of the
euro and Turkish lira.

In the first six months of 2022, Goodyear net income was $262 million, or $0.91
per share, compared to $79 million, or $0.32 per share, in the first six months
of 2021. The increase in Goodyear net income was primarily due to higher segment
operating income, an increase in Other Income driven by the one-time gain in the
second quarter of 2022 for the sale and leaseback transaction in Americas, and
lower rationalization expense. These increases were partially offset by higher
U.S. and Foreign Tax Expense reflecting higher pre-tax earnings and higher
interest expense. Additionally, our results in the first half of 2021 included
the impact of a severe winter storm in the U.S. estimated to negatively impact
earnings by $50 million ($40 million after-tax and minority).

Total segment operating income for the first six months of 2022 was $667
million, compared to $525 million in the first six months of 2021. The increase
was primarily due to global improvements in price and product mix of $1,071
million, which more than offset higher raw material costs of $797 million,
higher tire volume of $71 million in EMEA and Asia Pacific, partially offset by
lower tire volume in our legacy business in Americas, and higher earnings in
other tire-related businesses of $28 million, primarily driven by higher
aviation sales in Americas and EMEA. These increases were partially offset by
increased conversion costs of $168 million, higher transportation and import
duty costs of $124 million and higher SAG of $83 million, all driven by the
inflationary cost trends discussed above, as well as the favorable indirect tax
ruling in Brazil of $69 million in 2021, of which $66 million ($43 million
after-tax and minority) related to prior periods. The remainder of the change
was driven by the addition of Cooper Tire's operating results. Refer to "Results
of Operations - Segment Information" for additional information.

Liquidity

At June 30, 2022, we had $1,248 million of cash and cash equivalents as well as
$3,210 million of unused availability under our various credit agreements,
compared to $1,088 million and $4,345 million, respectively, at December 31,
2021. The increase in cash and cash equivalents of $160 million was primarily
due to net borrowings of $1,129 million and cash proceeds of $108 million
received from the sale and leaseback transaction in Americas, partially offset
by cash used by operating activities of $533 million and capital expenditures of
$511 million. Cash used by operating activities reflects cash used for working
capital of $1,242 million and rationalization payments of $59 million, partially
offset by net income for the period of $266 million, which includes non-cash
charges for depreciation and amortization of $481 million, a non-cash gain of
$95 million on the sale and leaseback transaction in Americas, and the impact of
other non-cash changes to various assets and liabilities on the Balance Sheet.

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Outlook

In the second quarter of 2022, consumer replacement tire industry volume
exceeded pre-pandemic levels in the Americas and in Europe, while the Asia
Pacific industry remained below 2019 levels given continuing impacts related to
the COVID-19 pandemic. Globally, OE manufacturers continue to be affected by
shortages of components and materials, which are limiting vehicle production. In
addition, the conflict in Ukraine has exacerbated continuing supply chain
challenges and increases in the cost of certain raw materials, as well as in
energy and transportation costs.

In the third quarter of 2022, we expect continued volume growth in EMEA and Asia
Pacific. We expect our raw material costs to increase approximately $1.0 billion
in the second half of 2022 compared to 2021, including Cooper Tire, with
approximately $600 million of those increases occurring in the third quarter of
2022. We anticipate price and product mix to continue to more than offset raw
material costs in the third quarter of 2022, with a similar net impact on our
earnings that we experienced in the first and second quarters. Natural and
synthetic rubber prices and other commodity prices historically have been
volatile, and our raw material costs could change based on future cost
fluctuations and changes in foreign exchange rates. We continue to focus on
price and product mix, to substitute lower cost materials where possible, to
work to identify additional substitution opportunities, to reduce the amount of
material required in each tire, and to pursue alternative raw materials to
minimize the impact of higher raw material costs.

In addition to higher raw material costs, we expect the impact of other
inflationary cost pressures to continue to persist, particularly with respect to
transportation, labor and energy costs with increases in the third quarter of
2022 compared to 2021 being similar to the levels we experienced in the second
quarter of 2022. We continue to focus on actions to offset costs other than raw
materials through cost savings initiatives, further price actions and
improvements in product mix.

We expect our operating results to be negatively impacted by foreign currency
translation by $25 million to $30 million in the third quarter of 2022 due to
the strength of the U.S. dollar at current spot rates.

During 2022, we expect to reinvest approximately $300 million in working capital
to rebuild inventory levels to meet customer demand and support service levels.
We expect our capital expenditures to be between $1.1 billion and $1.2 billion.
Our capital expenditures in 2022 will be focused on projects to modernize
certain of our manufacturing facilities and expand others to address supply
constraints and growing demand, in addition to capital expenditures sustaining
our facilities.

Refer to "Item 1A. Risk Factors" in our Form 10-K for the year ended December
31, 2021 (the "2021 Form 10-K") and our Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2022 for a discussion of the factors that may
impact our business, results of operations, financial condition or liquidity and
"Forward-Looking Information - Safe Harbor Statement" in this Quarterly Report
on Form 10-Q for a discussion of our use of forward-looking statements.

                             RESULTS OF OPERATIONS

CONSOLIDATED

Three Months Ended June 30, 2022 and 2021

Net sales in the second quarter of 2022 were $5,212 million, increasing $1,233
million, or 31.0%, from $3,979 million in the second quarter of 2021. Goodyear
net income was $166 million, or $0.58 per share, in the second quarter of 2022,
compared to $67 million, or $0.27 per share, in the second quarter of 2021.

Net sales increased in the second quarter of 2022, primarily due to the addition
of an incremental $663 million of net sales from Cooper Tire, global
improvements in price and product mix of $539 million, higher tire volume of
$193 million in EMEA and Asia Pacific, partially offset by lower tire volume in
our legacy business in Americas, and higher sales in other tire-related
businesses of $47 million, driven by higher aviation sales, primarily in
Americas and EMEA, increased retail sales in Americas and growth in EMEA's Fleet
Solutions. These increases were partially offset by unfavorable foreign currency
translation of $207 million, primarily in EMEA, driven by the weakening of the
euro and Turkish lira.

Worldwide tire unit sales in the second quarter of 2022 were 45.6 million units,
increasing 8.1 million units, or 21.5%, from 37.5 million units in the second
quarter of 2021. Replacement tire volume increased globally by 6.6 million
units, or 22.6%, driven by the addition of Cooper Tire's units. OE tire volume
increased globally by 1.5 million units, or 17.5%, reflecting continued recovery
from the COVID-19 pandemic and the addition of Cooper Tire's units, despite
ongoing challenges to vehicle production as a result of global supply chain
disruptions, including shortages of key manufacturing components, such as
semiconductors.

Cost of Goods Sold ("CGS") in the second quarter of 2022 was $4,172 million,
increasing $1,094 million, or 35.5%, from $3,078 million in the second quarter
of 2021. CGS increased primarily due to the addition of an incremental $474
million of CGS from Cooper Tire, higher raw material costs of $419 million,
higher tire volume of $150 million in EMEA and Asia Pacific, partially offset by
lower tire volume in our legacy business in Americas, higher conversion costs of
$100 million, driven by inflation and

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higher energy costs, the favorable indirect tax ruling in Brazil of $69 million
in 2021, and higher transportation and import duty costs of $58 million. These
increases were partially offset by foreign currency translation of $176 million,
primarily in EMEA, driven by the weakening of the euro and Turkish lira. CGS in
the second quarter of 2022 included a gain of $14 million ($11 million after-tax
and minority) due to a reduction in U.S. duty rates on certain commercial tires
that were imported during 2020. CGS in the second quarter of 2021 included $38
million ($29 million after-tax and minority) of amortization expense related to
a fair value adjustment to the Closing Date inventory of Cooper Tire that was
acquired by Goodyear.

CGS in the second quarter of 2022 and 2021 included pension expense of $6
million and $5 million, respectively. CGS in the second quarter of 2021 included
$25 million of incremental year-over-year savings from rationalization plans.
CGS was 80.0% of sales in the second quarter of 2022, compared to 77.4% in the
second quarter of 2021.

SAG in the second quarter of 2022 was $717 million, increasing $59 million, or
9.0%, from $658 million in the second quarter of 2021. SAG increased primarily
due to the addition of Cooper Tire's operating results. SAG also included
increases related to higher wages and benefits of $12 million and $27 million of
other net cost increases reflecting the inflationary cost pressures discussed
above, partially offset by foreign currency translation of $34 million,
primarily in EMEA, driven by the weakening of the euro and Turkish lira.

SAG in the second quarter of 2022 and 2021 included pension expense of $4
million and $5 million, respectively. SAG in the second quarter of 2022 included
$1 million of incremental year-over-year savings from rationalization plans,
compared to $3 million in 2021. SAG was 13.8% of sales in the second quarter of
2022, compared to 16.5% in the second quarter of 2021.

SAG and CGS in the second quarter of 2021 included a total of $6 million ($4
million after-tax and minority) of transaction costs related to the Cooper Tire
acquisition.

We recorded net rationalization charges of $26 million ($20 million after-tax
and minority) in the second quarter of 2022, primarily related to a current year
plan to reduce duplicative global SAG headcount and close redundant warehouse
locations in Americas as part of our ongoing Cooper Tire integration efforts, in
line with previously announced planned synergies. We recorded $18 million ($16
million after-tax and minority) of net rationalization charges in the second
quarter of 2021 primarily related to the permanent closure of our Gadsden,
Alabama tire manufacturing facility ("Gadsden") and the modernization of two of
our tire manufacturing facilities in Germany. For further information, refer to
Note to the Consolidated Financial Statements No. 4, Costs Associated with
Rationalization Programs.

Interest expense in the second quarter of 2022 was $110 million, increasing $13
million, or 13.4%, from $97 million in the second quarter of 2021. Interest
expense in the second quarter of 2021 included a $5 million ($4 million
after-tax and minority) charge related to the redemption of our $1.0 billion
5.125% senior notes due 2023. The average interest rate was 5.25% in the second
quarter of 2022, compared to 5.51% in the second quarter of 2021. The average
debt balance was $8,387 million in the second quarter of 2022, compared to
$7,037 million in the second quarter of 2021. The increase in average debt is
primarily due to additional borrowings that were used to partially fund the
Cooper Tire acquisition in the second quarter of 2021 and support our working
capital requirements in 2022.

Other (Income) Expense in the second quarter of 2022 was $65 million of income,
compared to $30 million of expense in the second quarter of 2021. Other (Income)
Expense for the second quarter of 2022 includes a gain on asset sales of $95
million ($71 million after-tax and minority) related to the sale and leaseback
transaction in Americas and pension settlement charges of $18 million ($13
million after-tax and minority). Other (Income) Expense for the second quarter
of 2021 includes $48 million ($32 million after-tax and minority) of interest
income related to the favorable indirect tax ruling in Brazil, $42 million ($35
million after-tax and minority) of transaction and other costs related to the
Cooper Tire acquisition, and pension settlement charges of $19 million ($14
million after-tax and minority).

For the second quarter of 2022, we recorded income tax expense of $82 million on
income before income taxes of $252 million. Income tax expense for the three
months ended June 30, 2022 includes net discrete tax expense of $14 million ($14
million after minority interest), primarily related to the write off of deferred
tax assets for tax loss carryforwards in the UK.

In the second quarter of 2021, we recorded income tax expense of $27 million on
income before income taxes of $98 million. Income tax expense for the three
months ended June 30, 2021 includes a net discrete tax benefit of $32 million
($32 million after minority interest), primarily related to adjusting our
deferred tax assets in England for an enacted increase in the tax rate,
partially offset by a net discrete charge for various other items, including the
settlement of a tax audit in Poland.

For further information regarding income taxes, refer to Note to the Consolidated Financial Statements No. 6, Income Taxes.

Minority shareholders' net income in both the second quarter of 2022 and 2021 was $4 million.

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Six Months Ended June 30, 2022 and 2021

Net sales in the first six months of 2022 were $10,120 million, increasing
$2,630 million, or 35.1%, from $7,490 million in the first six months of 2021.
Goodyear net income was $262 million, or $0.91 per share, in the first six
months of 2022, compared to $79 million, or $0.32 per share, in the first six
months of 2021.

Net sales increased in the first six months of 2022, primarily due to the
addition of an incremental $1,532 million of net sales from Cooper Tire, global
improvements in price and product mix of $1,048 million, higher tire volume of
$296 million in EMEA and Asia Pacific, partially offset by lower tire volume in
our legacy business in Americas, and higher sales in other tire-related
businesses of $149 million, driven by increased third-party chemical sales in
Americas, higher aviation sales, primarily in Americas and EMEA, growth in
EMEA's Fleet Solutions and increased retail sales in Americas. These increases
were partially offset by unfavorable foreign currency translation of $393
million, primarily in EMEA, driven by the weakening of the euro and Turkish
lira.

Worldwide tire unit sales in the first six months of 2022 were 90.6 million
units, increasing 18.1 million units, or 25.0%, from 72.5 million units in the
first six months of 2021. Replacement tire volume increased globally by 15.8
million units, or 28.6%, driven by the addition of Cooper Tire's units. OE tire
volume increased by 2.3 million units, or 13.2%, primarily in Asia Pacific and
Americas, reflecting continued recovery from the COVID-19 pandemic and the
addition of Cooper Tire's units, despite ongoing challenges to vehicle
production as a result of global supply chain disruptions, including shortages
of key manufacturing components, such as semiconductors.

CGS in the first six months of 2022 was $8,138 million, increasing $2,309
million, or 39.6%, from $5,829 million in the first six months of 2021. CGS
increased primarily due to the addition of an incremental $1,193 million of CGS
from Cooper Tire, higher raw material costs of $797 million, higher tire volume
of $225 million in EMEA and Asia Pacific, partially offset by lower tire volume
in our legacy business in Americas, higher conversion costs of $168 million,
driven by inflation and higher energy costs, higher transportation and import
duty costs of $124 million, higher costs in other tire-related businesses of
$121 million, driven by increased third-party chemical sales and retail sales in
Americas as well as growth in EMEA's Fleet Solutions, and the favorable indirect
tax ruling in Brazil of $69 million in 2021. These increases were partially
offset by foreign currency translation of $322 million, primarily in EMEA,
driven by the weakening of the euro and Turkish lira. CGS in the first six
months of 2022 included a gain of $14 million ($11 million after-tax and
minority) due to a reduction in U.S. duty rates on certain commercial tires that
were imported during 2020. CGS in the first six months of 2021 included $38
million ($29 million after-tax and minority) of amortization expense related to
a fair value adjustment to the Closing Date inventory of Cooper Tire that was
acquired by Goodyear.

CGS in the first six months of 2022 and 2021 included pension expense of $11
million and $9 million, respectively. CGS in the first six months of 2022
included $1 million of incremental year-over-year savings from rationalization
plans, compared to $57 million in 2021. CGS was 80.4% of sales in the first six
months of 2022, compared to 77.8% in the first six months of 2021.

SAG in the first six months of 2022 was $1,405 million, increasing $183 million,
or 15.0%, from $1,222 million in the first six months of 2021. SAG increased
primarily due to the addition of Cooper Tire's operating results. SAG also
included increases related to higher wages and benefits of $42 million,
including the impact of higher incentive compensation, and $64 million of other
net cost increases reflecting the inflationary cost pressures discussed above,
partially offset by foreign currency translation of $62 million, primarily in
EMEA, driven by the weakening of the euro and Turkish lira.

SAG in the first six months of 2022 and 2021 included pension expense of $8
million and $9 million, respectively. SAG in the first six months of 2022
included $2 million of incremental year-over-year savings from rationalization
plans, compared to $5 million in 2021. SAG was 13.9% of sales in the first six
months of 2022, compared to 16.3% in the first six months of 2021.

SAG and CGS in the first six months of 2021 included a total of $6 million ($4
million after-tax and minority) of transaction costs related to the Cooper Tire
acquisition.

We recorded net rationalization charges of $37 million ($29 million after-tax
and minority) in the first six months of 2022 and $68 million ($61 million
after-tax and minority) in the first six months of 2021. Net rationalization
charges in the first six months of 2022 primarily related to the plan to reduce
duplicative global SAG headcount and close redundant warehouse locations in
Americas as part of our ongoing Cooper Tire integration efforts. Net
rationalization charges in the first six months of 2021 primarily related to the
modernization of two of our tire manufacturing facilities in Germany, a plan to
reduce SAG headcount in EMEA, and the permanent closure of Gadsden. For further
information, refer to Note to the Consolidated Financial Statements No. 4, Costs
Associated with Rationalization Programs.

Interest expense in the first six months of 2022 was $214 million, increasing
$38 million, or 21.6%, from $176 million in the first six months of 2021.
Interest expense in the first six months of 2021 included a $5 million ($4
million after-tax and minority) charge related to the redemption of our $1.0
billion 5.125% senior notes due 2023. The average interest rate was 5.26% in the
first six months of 2022 compared to 5.38% in the first six months of 2021. The
average debt balance was $8,135 million in the

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first six months of 2022 compared to $6,542 million in the first six months of
2021. The increase in average debt is primarily due to additional borrowings
that were used to partially fund the Cooper Tire acquisition in the second
quarter of 2021 and support our working capital requirements in 2022.

Other (Income) Expense in the first six months of 2022 was $60 million of
income, compared to $64 million of expense in the first six months of 2021.
Other (Income) Expense for the first six months of 2022 includes net gains on
asset sales of $98 million ($75 million after-tax and minority), primarily
related to the sale and leaseback transaction in Americas and pension settlement
charges of $18 million ($13 million after-tax and minority). Other (Income)
Expense for the first six months of 2021 includes $49 million ($41 million
after-tax and minority) of transaction and other costs related to the Cooper
Tire acquisition, $48 million ($32 million after-tax and minority) of interest
income related to the favorable indirect tax ruling in Brazil, pension
settlement charges of $19 million ($14 million after-tax and minority) and an
out of period adjustment of $7 million ($7 million after-tax and minority) of
expense related to foreign currency exchange in Americas. The remainder of the
change was driven by a $7 million increase in royalty income, primarily due to
an increase in chemical royalties in Americas.

For the first six months of 2022, we recorded income tax expense of $120 million
on income before income taxes of $386 million. Income tax expense for the six
months ended June 30, 2022 includes net discrete tax expense of $18 million ($18
million after minority interest), including charges of $14 million to write off
deferred tax assets related to tax loss carryforwards in the UK and $11 million
to establish a full valuation allowance on our net deferred tax assets in
Russia, partially offset by a net benefit of $7 million for various other items.

In the first six months of 2021, we recorded income tax expense of $42 million
on income before income taxes of $131 million. Income tax expense for the six
months ended June 30, 2021 includes a net discrete tax benefit of $29 million
($29 million after minority interest), primarily related to adjusting our
deferred tax assets in England for an enacted increase in the tax rate,
partially offset by a net discrete charge for various other items, including the
settlement of a tax audit in Poland.

We record taxes based on overall estimated annual effective tax rates. The
difference between our effective tax rate and the U.S. statutory rate of 21% for
the six months ended June 30, 2022 primarily relates to losses in foreign
jurisdictions in which no tax benefits are recorded and the discrete items noted
above. The difference between our effective tax rate and the U.S. statutory rate
of 21% for the six months ended June 30, 2021 primarily relates to the tax on
the favorable indirect tax ruling in Brazil, losses in foreign jurisdictions in
which no tax benefits are recorded, and the discrete items noted above.

At both June 30, 2022 and December 31, 2021, we had approximately $1.2 billion
of U.S. federal, state and local net deferred tax assets, net of valuation
allowances totaling $26 million primarily for state tax loss carryforwards with
limited lives. In the U.S., we have a cumulative loss for the three-year period
ending June 30, 2022. However, as the three-year cumulative loss in the U.S. is
driven by business disruptions created by the COVID-19 pandemic, primarily in
2020, and only include the favorable impact of the Cooper Tire acquisition since
the Closing Date, we also considered other objectively verifiable information in
assessing our ability to utilize our net deferred tax assets, including
continued favorable overall volume trends in the tire industry and our tire
volume compared to 2020 levels. In addition, the Cooper Tire acquisition has
generated significant incremental domestic earnings since the Closing Date and
provides opportunities for cost and other operating synergies to further improve
our U.S. profitability.

At both June 30, 2022 and December 31, 2021, our U.S. net deferred tax assets
include $339 million of foreign tax credits with limited lives, net of valuation
allowances of $3 million. Our earnings and forecasts of future profitability,
taking into consideration recent trends, along with three significant sources of
foreign income, provide us sufficient positive evidence that we will be able to
utilize these net foreign tax credits which expire through 2030. Our sources of
foreign income are (1) 100% of our domestic profitability can be
re-characterized as foreign source income under current U.S. tax law to the
extent domestic losses have offset foreign source income in prior years, (2)
annual net foreign source income, exclusive of dividends, primarily from
royalties, and (3) tax planning strategies, including capitalizing research and
development costs, accelerating income on cross border transactions, including
sales of inventory or raw materials to our subsidiaries, and reducing U.S.
interest expense by, for example, reducing intercompany loans through
repatriating current year earnings of foreign subsidiaries, all of which would
increase our domestic profitability.

We consider our current forecasts of future profitability in assessing our
ability to realize our deferred tax assets, including our foreign tax credits.
These forecasts include the impact of recent trends, including various
macroeconomic factors such as the impact of higher raw material, transportation,
labor and energy costs, on our profitability, as well as the impact of tax
planning strategies. These macroeconomic factors possess a high degree of
volatility and can significantly impact our profitability. As such, there is a
risk that future earnings will not be sufficient to fully utilize our U.S. net
deferred tax assets, including our foreign tax credits. However, we believe our
forecasts of future profitability along with the three significant sources of
foreign income described above provide us sufficient positive, objectively
verifiable evidence to conclude that it is more likely than not that, at June
30, 2022, our U.S. net deferred tax assets, including our foreign tax credits,
net of valuation allowances, will be fully utilized.

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At June 30, 2022 and December 31, 2021, we also had approximately $1.2 billion
and $1.3 billion of foreign net deferred tax assets, respectively, and related
valuation allowances of $1.0 billion. Our losses in various foreign taxing
jurisdictions in recent periods represented sufficient negative evidence to
require us to maintain a full valuation allowance against certain of these net
foreign deferred tax assets. Most notably, in Luxembourg, we maintain a
valuation allowance of approximately $800 million on all of our net deferred tax
assets. Each reporting period, we assess available positive and negative
evidence and estimate if sufficient future taxable income will be generated to
utilize these existing deferred tax assets. We do not believe that sufficient
positive evidence required to release valuation allowances having a significant
impact on our financial position or results of operations will exist within the
next twelve months.

For further information regarding income taxes and the realizability of our deferred tax assets, including our foreign tax credits, refer to Note to the Consolidated Financial Statements No. 6, Income Taxes.

Minority shareholders' net income in the first six months of 2022 was $4 million, compared to $10 million in 2021.

SEGMENT INFORMATION

Segment information reflects our strategic business units ("SBUs"), which are
organized to meet customer requirements and global competition and are segmented
on a regional basis. Since the Closing Date, Cooper Tire's operating results
have been incorporated into each of our SBUs. We discuss the impact of Cooper
Tire's net sales and operating income separately within each SBU for periods
presented that are not fully comparable.

Results of operations are measured based on net sales to unaffiliated customers
and segment operating income. Each segment exports tires to other segments. The
financial results of each segment exclude sales of tires exported to other
segments, but include operating income derived from such transactions. Segment
operating income is computed as follows: Net Sales less CGS (excluding asset
write-off and accelerated depreciation charges) and SAG (including certain
allocated corporate administrative expenses). Segment operating income also
includes certain royalties and equity in earnings of most affiliates. Segment
operating income does not include net rationalization charges (credits), asset
sales and certain other items.

Total segment operating income for the second quarter of 2022 was $364 million,
an increase of $65 million, or 21.7%, from $299 million in the second quarter of
2021. Total segment operating margin in the second quarter of 2022 was 7.0%,
compared to 7.5% in the second quarter of 2021. Total segment operating income
for the first six months of 2022 was $667 million, an increase of $142 million,
or 27.0%, from $525 million in the first six months of 2021. Total segment
operating margin in the first six months of 2022 was 6.6%, compared to 7.0% in
the first six months of 2021.

Management believes that total segment operating income is useful because it
represents the aggregate value of income created by our SBUs and excludes items
not directly related to the SBUs for performance evaluation purposes. Total
segment operating income is the sum of the individual SBUs' segment operating
income. Refer to Note to the Consolidated Financial Statements No. 8, Business
Segments, for further information and for a reconciliation of total segment
operating income to Income before Income Taxes.

Americas

                                   Three Months Ended June 30,                         Six Months Ended June 30,
                                                                Percent                                           Percent
(In millions)              2022        2021        Change       Change        2022        2021       Change       Change
Tire Units                   23.3        19.0          4.3          22.4 %      45.5        34.5        11.0          32.0 %
Net Sales                 $ 3,147     $ 2,256     $    891          39.5 %   $ 6,062     $ 4,043     $ 2,019          49.9 %
Operating Income              293         233           60          25.8 %       509         347         162          46.7 %
Operating Margin              9.3 %      10.3 %                             

8.4 % 8.6 %

Three Months Ended June 30, 2022 and 2021

Americas unit sales in the second quarter of 2022 increased 4.3 million units,
or 22.4%, to 23.3 million units. Replacement tire volume increased 3.8 million
units, or 24.4%, primarily due to the addition of Cooper Tire's units, partially
offset by a decrease in our consumer business in the United States. OE tire
volume increased 0.5 million units, or 12.5%, driven by our consumer business in
the United States and Canada and by the addition of Cooper Tire's units.

Net sales in the second quarter of 2022 were $3,147 million, increasing $891
million, or 39.5%, from $2,256 million in the second quarter of 2021. The
increase in net sales was primarily due to an incremental $599 million of net
sales from Cooper Tire, favorable price and product mix of $319 million, driven
by price increases, higher sales in other tire-related businesses of $29
million, primarily due to higher aviation, retail and third-party chemical
sales, and favorable foreign currency translation of $24 million, primarily
related to a stronger Brazilian real. These increases were partially offset by
lower tire volume in our legacy

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business of $81 million. We estimate that the severe winter storm in the U.S. negatively impacted Americas net sales in the second quarter of 2021 by approximately $11 million.

Operating income in the second quarter of 2022 was $293 million, increasing $60
million, or 25.8%, from $233 million in the second quarter of 2021. The increase
in operating income was due to improvements in price and product mix of $311
million, which more than offset higher raw material costs of $183 million, and
higher earnings in other tire-related businesses of $6 million. These increases
were partially offset by the favorable indirect tax ruling in Brazil of $69
million in 2021, higher conversion costs of $52 million, driven by inflation,
increased transportation and import duty costs of $47 million, lower tire volume
in our legacy business of $23 million, and a favorable out of period adjustment
of $8 million in 2021 related to accrued freight charges. The remainder of the
change was driven by the addition of Cooper Tire's operating results. We
estimate that the severe winter storm in the U.S. as well as a national strike
in Colombia negatively impacted Americas operating income in the second quarter
of 2021 by approximately $24 million and $4 million ($4 million after-tax and
minority), respectively.

Operating income in the second quarter of 2022 excluded net rationalization
charges of $11 million and net gains on asset sales of $95 million, primarily
related to the sale and leaseback transaction for certain consumer and
commercial retail locations in the United States. Operating income in the second
quarter of 2021 excluded net rationalization charges of $8 million.

Six Months Ended June 30, 2022 and 2021

Americas unit sales in the first six months of 2022 increased 11.0 million
units, or 32.0%, to 45.5 million units. Replacement tire volume increased 10.4
million units, or 37.6%, primarily due to the addition of Cooper Tire's units,
partially offset by a decrease in our consumer business in the United States. OE
tire volume increased 0.6 million units, or 8.5%, despite the ongoing negative
impacts to vehicle production as a result of global supply chain disruptions,
including shortages of key manufacturing components, such as semiconductors, and
was driven by our consumer business in Canada and the United States, as well as
the addition of Cooper Tire's units.

Net sales in the first six months of 2022 were $6,062 million, increasing $2,019
million, or 49.9%, from $4,043 million in the first six months of 2021. The
increase in net sales was primarily due to the addition of an incremental $1,355
million of net sales from Cooper Tire, favorable price and product mix of $650
million, driven by price increases, higher sales in other tire-related
businesses of $101 million, primarily due to higher chemical, aviation and
retail sales, and favorable foreign currency translation of $20 million,
primarily related to a stronger Brazilian real. These increases were partially
offset by lower tire volume in our legacy business of $107 million. We estimate
that the severe winter storm in the U.S. negatively impacted Americas net sales
for the first six months of 2021 by approximately $35 million.

Operating income in the first six months of 2022 was $509 million, increasing
$162 million, or 46.7%, from $347 million in the first six months of 2021. The
increase in operating income was due to improvements in price and product mix of
$633 million, which more than offset higher raw material costs of $387 million,
higher earnings in other tire-related businesses of $13 million, and the net
impact of out of period adjustments in 2021 totaling $6 million ($6 million
after-tax and minority) of expense primarily related to inventory and accrued
freight charges. These increases were partially offset by increased
transportation and import duty costs of $101 million, the favorable indirect tax
ruling in Brazil of $69 million in 2021, higher conversion costs of $66 million,
driven by inflation, lower tire volume in our legacy business of $30 million,
and higher SAG of $24 million, primarily due to higher wages and benefits and
inflation. The remainder of the change was driven by the addition of Cooper
Tire's operating results. We estimate that the severe winter storm in the U.S.
as well as a national strike in Colombia negatively impacted Americas operating
income in 2021 by approximately $41 million and $4 million ($4 million after-tax
and minority), respectively.

Operating income in the first six months of 2022 excluded net rationalization
charges of $18 million and net gains on asset sales of $98 million, primarily
related to the sale and leaseback transaction. Operating income in the first six
months of 2021 excluded net rationalization charges of $18 million.

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Europe, Middle East and Africa

                                   Three Months Ended June 30,                         Six Months Ended June 30,
                                                                Percent                                            Percent
(In millions)              2022        2021        Change       Change        2022        2021        Change       Change
Tire Units                   14.5        12.0          2.5          20.8 %      29.0        24.7          4.3          17.5 %
Net Sales                 $ 1,497     $ 1,230     $    267          21.7 %   $ 2,923     $ 2,461     $    462          18.8 %
Operating Income               52          43            9          20.9 %       111         117           (6 )        (5.1 )%
Operating Margin              3.5 %       3.5 %                                  3.8 %       4.8 %

Three Months Ended June 30, 2022 and 2021

EMEA unit sales in the second quarter of 2022 increased 2.5 million units, or
20.8%, to 14.5 million units. Replacement tire volume increased 2.3 million
units, or 25.2%, primarily in our consumer business, reflecting increased
industry demand due to continued recovery from the COVID-19 pandemic, our
ongoing initiative to align distribution in Europe and the addition of Cooper
Tire's units. OE tire volume increased 0.2 million units, or 7.0%, reflecting
increased demand from improved vehicle production and share gains driven by new
consumer fitments. Overall, shortages of certain automobile parts, such as
semiconductors, continue to affect OE manufacturers' ability to produce consumer
and commercial vehicles consistently.

Net sales in the second quarter of 2022 were $1,497 million, increasing $267
million, or 21.7%, from $1,230 million in the second quarter of 2021. Net sales
increased primarily due to improvements in price and product mix of $206
million, driven by price increases, higher tire volume of $205 million, the
addition of an incremental $43 million of net sales from Cooper Tire, and higher
sales in other tire-related businesses of $23 million, primarily due to growth
in Fleet Solutions and an increase in aviation sales. These increases were
partially offset by unfavorable foreign currency translation of $207 million,
driven by a weaker euro and Turkish lira.

Operating income in the second quarter of 2022 was $52 million, increasing $9
million, or 20.9%, from $43 million in the second quarter of 2021. The increase
in operating income was primarily due to improvements in price and product mix
of $217 million, which more than offset higher raw material costs of $182
million, higher tire volume of $50 million and higher earnings in other tire
related businesses of $12 million. These increases were partially offset by
higher conversion costs of $44 million, reflecting higher energy costs and other
inflationary cost pressures, higher SAG of $33 million, driven by inflation, and
higher transportation costs of $9 million.

Operating income in the second quarter of 2022 excluded net rationalization charges of $9 million. Operating income in the second quarter of 2021 excluded net rationalization charges of $7 million.

Six Months Ended June 30, 2022 and 2021

EMEA unit sales in the first six months of 2022 increased 4.3 million units, or
17.5%, to 29.0 million units. Replacement tire volume increased 4.4 million
units, or 23.8%, primarily in our consumer business, reflecting increased
industry demand due to continued recovery from the COVID-19 pandemic, our
ongoing initiative to align distribution in Europe and the addition of Cooper
Tire's units. OE tire volume decreased 0.1 million units, or 1.7%, reflecting
the negative impact on vehicle production of global supply chain disruptions,
including shortages of key manufacturing components, such as semiconductors,
partially offset by share gains driven by new consumer fitments.

Net sales in the first six months of 2022 were $2,923 million, increasing $462
million, or 18.8%, from $2,461 million in the first six months of 2021. Net
sales increased primarily due to improvements in price and product mix of $370
million, driven by price increases, higher tire volume of $308 million, the
addition of an incremental $105 million of net sales from Cooper Tire, and
higher sales in other tire-related businesses of $54 million, primarily due to
growth in Fleet Solutions and an increase in aviation, motorcycle and retread
sales. These increases were partially offset by unfavorable foreign currency
translation of $373 million, driven by a weaker euro and Turkish lira.

Operating income in the first six months of 2022 was $111 million, decreasing $6
million, or 5.1%, from $117 million in the first six months of 2021. The
decrease in operating income was primarily due to higher conversion costs of $93
million, reflecting higher energy costs and other inflationary cost pressures,
higher SAG of $59 million, primarily related to higher inflation, wages and
benefits and advertising costs, higher transportation costs of $20 million, and
unfavorable foreign currency translation of $11 million, driven by a weaker euro
and Turkish lira. These decreases were partially offset by improvements in price
and product mix of $383 million, which more than offset higher raw material
costs of $309 million, higher tire volume of $78 million, higher earnings in
other tire-related businesses of $13 million, and $9 million of expense in 2021
related to inventory revaluations. The remainder of the change was driven by the
addition of Cooper Tire's operating results.

Operating income in the first six months of 2022 excluded net rationalization charges of $14 million. Operating income in the first six months of 2021 excluded net rationalization charges of $44 million.

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Asia Pacific

                                   Three Months Ended June 30,             

Six Months Ended June 30,

                                                               Percent                                           Percent
(In millions)              2022         2021       Change       Change        2022        2021       Change       Change
Tire Units                    7.8         6.5          1.3         19.9 %       16.1       13.3          2.8         20.7 %
Net Sales                 $   568      $  493     $     75         15.2 %    $ 1,135     $  986     $    149         15.1 %
Operating Income               19          23           (4 )      (17.4 )%        47         61          (14 )      (23.0 )%
Operating Margin              3.3 %       4.7 %                                  4.1 %      6.2 %

Three Months Ended June 30, 2022 and 2021

Asia Pacific unit sales in the second quarter of 2022 increased 1.3 million
units, or 19.9%, to 7.8 million units. OE tire volume increased 0.8 million
units, or 38.3%. Replacement tire volume increased 0.5 million units, or 10.4%.
These increases primarily related to our consumer business in India and the
addition of Cooper Tire's units, partially offset by decreases in China as a
result of renewed COVID-19 stay-at-home orders earlier in the quarter.

Net sales in the second quarter of 2022 were $568 million, increasing $75
million, or 15.2%, from $493 million in the second quarter of 2021. Net sales
increased due to higher tire volume of $69 million, the addition of an
incremental $21 million of net sales from Cooper Tire, and favorable price and
product mix of $14 million, driven by price increases. These increases were
partially offset by unfavorable foreign currency translation of $24 million,
primarily related to the weakening of the Japanese yen and Australian dollar.

Operating income in the second quarter of 2022 was $19 million, decreasing $4
million, or 17.4%, from $23 million in the second quarter of 2021. The decrease
in operating income was primarily due to higher raw material costs of $54
million, higher conversion costs of $4 million, driven by the stay-at-home
orders in China and higher energy costs, partially offset by higher production
volume due to business growth in India, Japan and Malaysia, and higher SAG of $3
million, primarily due to inflation. These decreases were partially offset by
favorable price and product mix of $32 million, higher tire volume of $16
million and the addition of Cooper Tire's operating results.

Operating income in the second quarter of 2022 excluded net rationalization charges of $1 million.

Six Months Ended June 30, 2022 and 2021

Asia Pacific unit sales in the first six months of 2022 increased 2.8 million
units, or 20.7%, to 16.1 million units. OE tire volume increased 1.8 million
units, or 40.3%. Replacement tire volume increased 1.0 million units, or 10.7%.
These increases primarily related to the addition of Cooper Tire's units and our
consumer business in India.

Net sales in the first six months of 2022 were $1,135 million, increasing $149
million, or 15.1%, from $986 million in the first six months of 2021. Net sales
increased due to higher tire volume of $95 million, the addition of an
incremental $72 million of net sales from Cooper Tire, and favorable price and
product mix of $28 million, driven by price increases. These increases were
partially offset by unfavorable foreign currency translation of $40 million,
primarily related to the weakening of the Japanese yen and Australian dollar.

Operating income in the first six months of 2022 was $47 million, decreasing $14
million, or 23.0%, from $61 million in the first six months of 2021. The
decrease in operating income was primarily due to higher raw material costs of
$101 million and higher conversion costs of $9 million, driven by the
stay-at-home orders in China and higher energy costs, partially offset by higher
production volume due to business growth in India, Japan and Malaysia. These
decreases were partially offset by favorable price and product mix of $55
million, higher tire volume of $23 million and the addition of Cooper Tire's
operating results.

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                        LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are cash generated from our operating and financing activities. Our cash flows from operating activities are driven primarily by our operating results and changes in our working capital requirements and our cash flows from financing activities are dependent upon our ability to access credit or other capital.

At June 30, 2022, we had $1,248 million in cash and cash equivalents, compared
to $1,088 million at December 31, 2021. For the six months ended June 30, 2022,
net cash used by operating activities was $533 million, reflecting cash used for
working capital of $1,242 million and rationalization payments of $59 million,
partially offset by net income for the period of $266 million, which includes
non-cash charges for depreciation and amortization of $481 million, a non-cash
gain of $95 million on the sale and leaseback transaction in Americas, and the
impact of other non-cash changes to various assets and liabilities on the
Balance Sheet. Net cash used by investing activities was $403 million, primarily
representing capital expenditures of $511 million, partially offset by cash
proceeds of $108 million received from the sale and leaseback transaction in
Americas. Cash provided by financing activities was $1,132 million, primarily
due to net borrowings of $1,129 million.

At June 30, 2022, we had $3,210 million of unused availability under our various
credit agreements, compared to $4,345 million at December 31, 2021. The table
below presents unused availability under our credit facilities at those dates:

                                        June 30,      December 31,
(In millions)                             2022            2021

First lien revolving credit facility $ 2,069 $ 2,314 European revolving credit facility

            522               908
Chinese credit facilities                     303               374
Mexican credit facility                         -                42
Other foreign and domestic debt                22               147
Short term credit arrangements                294               560
                                       $    3,210     $       4,345



We have deposited our cash and cash equivalents and entered into various credit
agreements and derivative contracts with financial institutions that we
considered to be substantial and creditworthy at the time of such transactions.
We seek to control our exposure to these financial institutions by diversifying
our deposits, credit agreements and derivative contracts across multiple
financial institutions, by setting deposit and counterparty credit limits based
on long term credit ratings and other indicators of credit risk such as credit
default swap spreads, and by monitoring the financial strength of these
financial institutions on a regular basis. We also enter into master netting
agreements with counterparties when possible. By controlling and monitoring
exposure to financial institutions in this manner, we believe that we
effectively manage the risk of loss due to nonperformance by a financial
institution. However, we cannot provide assurance that we will not experience
losses or delays in accessing our deposits or lines of credit due to the
nonperformance of a financial institution. Our inability to access our cash
deposits or make draws on our lines of credit, or the inability of a
counterparty to fulfill its contractual obligations to us, could have a material
adverse effect on our liquidity, financial condition or results of operations in
the period in which it occurs.

We expect our 2022 cash flow needs to include capital expenditures of $1.1
billion to $1.2 billion. We also expect interest expense to be $450 million to
$475 million; rationalization payments to be approximately $100 million; income
tax payments to be $150 million to $200 million, excluding one-time items; and
contributions to our funded pension plans to be $25 million to $50 million. We
expect working capital to be a use of cash for the full year of 2022 of
approximately $300 million.

We are continuing to actively monitor our liquidity and intend to operate our
business in a way that allows us to address our cash flow needs with our
existing cash and available credit if they cannot be funded by cash generated
from operating or other financing activities. We believe that our liquidity
position is adequate to fund our operating and investing needs and debt
maturities for the next twelve months and to provide us with the ability to
respond to further changes in the business environment.

Our ability to service debt and operational requirements is also dependent, in
part, on the ability of our subsidiaries to make distributions of cash to
various other entities in our consolidated group, whether in the form of
dividends, loans or otherwise. In certain countries where we operate, such as
China, South Africa, Serbia and Argentina, transfers of funds into or out of
such countries by way of dividends, loans, advances or payments to third-party
or affiliated suppliers are generally or periodically subject to certain
requirements, such as obtaining approval from the foreign government and/or
currency exchange board before net assets can be transferred out of the country.
In addition, certain of our credit agreements and other debt instruments limit
the ability of foreign subsidiaries to make distributions of cash. Thus, we
would have to repay and/or amend these credit agreements and other debt
instruments in order to use this cash to service our consolidated debt. Because
of the inherent uncertainty of satisfactorily meeting these requirements or
limitations, we do not consider the net assets of our subsidiaries, including
our Chinese, South African, Serbian and Argentinian subsidiaries, which are
subject to such requirements or limitations to be integral to our liquidity or
our ability to service our debt and operational requirements. At June 30, 2022,
approximately $910 million of net assets, including approximately $246 million
of cash and cash equivalents, were subject to such requirements. The

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requirements we must comply with to transfer funds out of China, South Africa,
Serbia and Argentina have not adversely impacted our ability to make transfers
out of those countries.

Operating Activities

Net cash used by operating activities was $533 million in the first six months
of 2022, compared to net cash used by operating activities of $71 million in the
first six months of 2021. The $462 million increase in net cash used by
operating activities was primarily due to a net increase in cash used for
working capital of $702 million, partially offset by higher earnings in our SBUs
of $142 million, lower cash payments for rationalizations of $64 million, and a
$31 million decrease in cash payments for transaction and other costs related to
the Cooper Tire acquisition.

The net increase in cash used for working capital reflects increases in cash
used for Accounts Receivable of $479 million and Inventory of $348 million,
partially offset by an increase in cash provided by Accounts Payable - Trade of
$125 million. These changes were driven by higher sales volume, the impact of
current year inflationary cost pressures on our manufacturing operations and
pricing, an increase in finished goods inventory as we continue to restock in
order to meet anticipated near-term demand and the incremental working capital
of Cooper Tire.

Investing Activities

Net cash used by investing activities was $403 million in the first six months
of 2022, compared to $2,233 million in the first six months of 2021. Net cash
used by investing activities in the first six months of 2021 includes the
payment of $1,856 million for the cash portion of the purchase price related to
the Cooper Tire acquisition, net of cash and restricted cash acquired. Capital
expenditures were $511 million in the first six months of 2022, including $98
million related to Cooper Tire, compared to $385 million in the first six months
of 2021, including $17 million related to Cooper Tire. Beyond expenditures
required to sustain our facilities, capital expenditures in 2022 and 2021
primarily related to the modernization and expansion of tire manufacturing
facilities around the world. Net cash provided by investing activities in the
first six months of 2022 also includes $108 million of cash proceeds related to
the sale and leaseback transaction in Americas.

Financing Activities

Net cash provided by financing activities was $1,132 million in the first six
months of 2022, compared to net cash provided by financing activities of $1,820
million in the first six months of 2021. Financing activities in the first six
months of 2022 included net borrowings of $1,129 million. Financing activities
in the first six months of 2021 included net borrowings of $1,889 million,
partially offset by $73 million of debt-related costs and other financing
transactions.

Credit Sources

In aggregate, we had total credit arrangements of $11,475 million available at
June 30, 2022, of which $3,210 million were unused, compared to $11,628 million
available at December 31, 2021, of which $4,345 million were unused. At June 30,
2022, we had long term credit arrangements totaling $10,649 million, of which
$2,916 million were unused, compared to $10,624 million and $3,785 million,
respectively, at December 31, 2021. At June 30, 2022, we had short term
committed and uncommitted credit arrangements totaling $826 million, of which
$294 million were unused, compared to $1,004 million and $560 million,
respectively, at December 31, 2021. The continued availability of the short term
uncommitted arrangements is at the discretion of the relevant lender and may be
terminated at any time.

Outstanding Notes

At June 30, 2022, we had $5,551 million of outstanding notes compared to $5,591 million at December 31, 2021.

$2.75 billion Amended and Restated First Lien Revolving Credit Facility due 2026

Our amended and restated first lien revolving credit facility is available in
the form of loans or letters of credit. Up to $800 million in letters of credit
and $50 million of swingline loans are available for issuance under the
facility. Subject to the consent of the lenders whose commitments are to be
increased, we may request that the facility be increased by up to $250 million.
Based on our current liquidity, amounts drawn under this facility bear interest
at LIBOR plus 125 basis points, and undrawn amounts under the facility will be
subject to an annual commitment fee of 25 basis points.

Availability under the facility is subject to a borrowing base, which is based
on (i) eligible accounts receivable and inventory of The Goodyear Tire & Rubber
Company and certain of its U.S. and Canadian subsidiaries, (ii) the value of our
principal trademarks in an amount not to exceed $400 million, (iii) the value of
eligible machinery and equipment, and (iv) certain cash in an amount not to
exceed $275 million. To the extent that our eligible accounts receivable,
inventory and other components of the borrowing base decline in value, our
borrowing base will decrease and the availability under the facility may
decrease below $2.75 billion. As of June 30, 2022, our borrowing base, and
therefore our availability, under this facility was $108 million below the
facility's stated amount of $2.75 billion.

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At June 30, 2022, we had $570 million of borrowings and $3 million of letters of
credit issued under the revolving credit facility. At December 31, 2021, we had
no borrowings and $19 million of letters of credit issued under the revolving
credit facility.

€800 million Amended and Restated Senior Secured European Revolving Credit Facility due 2024

Our amended and restated European revolving credit facility consists of (i) a
€180 million German tranche that is available only to Goodyear Germany GmbH and
(ii) a €620 million all-borrower tranche that is available to Goodyear Europe
B.V. ("GEBV"), Goodyear Germany and Goodyear Operations S.A. Up to €175 million
of swingline loans and €75 million in letters of credit are available for
issuance under the all-borrower tranche. Amounts drawn under this facility will
bear interest at LIBOR plus 150 basis points for loans denominated in U.S.
dollars, EURIBOR plus 150 basis points for loans denominated in euros, and SONIA
plus 150 basis points for loans denominated in pounds sterling. Undrawn amounts
under the facility are subject to an annual commitment fee of 25 basis points.
Subject to the consent of the lenders whose commitments are to be increased, we
may request that the facility be increased by up to €200 million.

At June 30, 2022, there were no borrowings outstanding under the German tranche,
$310 million (€298 million) of borrowings outstanding under the all-borrower
tranche and no letters of credit outstanding under the European revolving credit
facility. At December 31, 2021, we had no borrowings and no letters of credit
outstanding under the European revolving credit facility.

Each of our first lien revolving credit facility and our European revolving
credit facility have customary representations and warranties including, as a
condition to borrowing, that all such representations and warranties are true
and correct, in all material respects, on the date of the borrowing, including
representations as to no material adverse change in our business or financial
condition since December 31, 2020 under the first lien facility and December 31,
2018 under the European facility.

Accounts Receivable Securitization Facilities (On-Balance Sheet)

GEBV and certain other of our European subsidiaries are parties to a
pan-European accounts receivable securitization facility that expires in 2027.
The terms of the facility provide the flexibility to designate annually the
maximum amount of funding available under the facility in an amount of not less
than €30 million and not more than €450 million. For the period from October 19,
2021 through October 19, 2022, the designated maximum amount of the facility is
€300 million.

The facility involves an ongoing daily sale of substantially all of the trade
accounts receivable of certain GEBV subsidiaries. These subsidiaries retain
servicing responsibilities. Utilization under this facility is based on eligible
receivable balances.

The funding commitments under the facility will expire upon the earliest to
occur of: (a) October 19, 2027, (b) the non-renewal and expiration (without
substitution) of all of the back-up liquidity commitments, (c) the early
termination of the facility according to its terms (generally upon an Early
Amortisation Event (as defined in the facility), which includes, among other
things, events similar to the events of default under our first lien revolving
credit facility; certain tax law changes; or certain changes to law, regulation
or accounting standards), or (d) our request for early termination of the
facility. The facility's current back-up liquidity commitments will expire on
October 19, 2022.

At June 30, 2022, the amounts available and utilized under this program totaled
$246 million (€237 million). At December 31, 2021, the amounts available and
utilized under this program totaled $279 million (€246 million). The program
does not qualify for sale accounting, and accordingly, these amounts are
included in Long Term Debt and Finance Leases.

Accounts Receivable Factoring Facilities (Off-Balance Sheet)

We have sold certain of our trade receivables under off-balance sheet programs.
For these programs, we have concluded that there is generally no risk of loss to
us from non-payment of the sold receivables. At June 30, 2022, the gross amount
of receivables sold was $597 million, compared to $605 million at December 31,
2021.

Letters of Credit

At June 30, 2022, we had $230 million in letters of credit issued under bilateral letter of credit agreements and other foreign credit facilities.

Supplier Financing

We have entered into payment processing agreements with several financial
institutions. Under these agreements, the financial institution acts as our
paying agent with respect to accounts payable due to our suppliers. These
agreements also allow our suppliers to sell their receivables to the financial
institutions at the sole discretion of both the supplier and the financial
institution on terms that are negotiated between them. We are not always
notified when our suppliers sell receivables under these programs. Our
obligations to our suppliers, including the amounts due and scheduled payment
dates, are not impacted by our suppliers' decisions to sell their receivables
under the programs. Agreements for such supplier financing programs totaled up
to $810 million and $630 million at June 30, 2022 and December 31, 2021,
respectively. The increase from December 31, 2021 is primarily due to the
overall increase in our accounts payable base as a result of the Cooper Tire
acquisition.

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Further Information

On March 5, 2021, the ICE Benchmark Administration, the administrator of LIBOR
("IBA"), confirmed its previously announced plans to cease publication of USD
LIBOR on December 31, 2021 for the one week and two month USD LIBOR tenors, and
on June 30, 2023 for all other USD LIBOR tenors. In addition, the IBA ceased
publication of all tenors of euro and Swiss franc LIBOR and most tenors of
Japanese yen and British pound LIBOR on December 31, 2021. In the United States,
efforts to identify a set of alternative U.S. dollar reference interest rates
include proposals by the Alternative Reference Rates Committee that has been
convened by the Federal Reserve Board and the Federal Reserve Bank of New York
to encourage market participants' use of the Secured Overnight Financing Rate,
known as SOFR. Additionally, the International Swaps and Derivatives
Association, Inc. published amendments to its definition book to incorporate new
benchmark fallbacks for derivative contracts that reference certain interbank
offered rates, including LIBOR. We cannot currently predict the effect of the
discontinuation of, or other changes to, LIBOR or any establishment of
alternative reference rates in the United States, the United Kingdom, the
European Union or elsewhere on the global capital markets. The uncertainty
regarding the future of LIBOR, as well as the transition from LIBOR to any
alternative reference rate or rates, could have adverse impacts on floating rate
obligations, loans, deposits, derivatives and other financial instruments that
currently use LIBOR as a benchmark rate. We have identified and evaluated our
financing obligations and other contracts that refer to LIBOR and expect to be
able to transition those obligations and contracts to an alternative reference
rate upon the discontinuation of LIBOR. Our first lien revolving credit facility
and our European revolving credit facility, which constitute the most
significant of our LIBOR-based debt obligations, contain "fallback" provisions
that address the potential discontinuation of LIBOR and facilitate the adoption
of an alternate rate of interest. We have not issued any long term floating rate
notes. Our first lien revolving credit facility also contains express provisions
for the use, at our option, of an alternative base rate (the higher of (a) the
prime rate, (b) the federal funds effective rate or the overnight bank funding
rate plus 50 basis points or (c) LIBOR plus 100 basis points). We do not believe
that the discontinuation of LIBOR, or its replacement with an alternative
reference rate or rates, will have a material impact on our results of
operations, financial position or liquidity.

For a further description of the terms of our outstanding notes, first lien
revolving credit facility, European revolving credit facility and pan-European
accounts receivable securitization facility, refer to Note to the Consolidated
Financial Statements No. 16, Financing Arrangements and Derivative Financial
Instruments, in our 2021 Form 10­K and Note to the Consolidated Financial
Statements No. 9, Financing Arrangements and Derivative Financial Instruments,
in this Form 10-Q.

Covenant Compliance

Our first lien revolving credit facility and some of the indentures governing
our notes contain certain covenants that, among other things, limit our ability
to incur additional debt or issue redeemable preferred stock, pay dividends,
repurchase shares or make certain other restricted payments or investments,
incur liens, sell assets, incur restrictions on the ability of our subsidiaries
to pay dividends or to make other payments to us, enter into affiliate
transactions, engage in sale and leaseback transactions, and consolidate, merge,
sell or otherwise dispose of all or substantially all of our assets. These
covenants are subject to significant exceptions and qualifications. Our first
lien revolving credit facility and the indentures governing our notes also have
customary defaults, including cross-defaults to material indebtedness of
Goodyear and its subsidiaries.

We have an additional financial covenant in our first lien revolving credit
facility that is currently not applicable. We become subject to that financial
covenant when the aggregate amount of our Parent Company (The Goodyear Tire &
Rubber Company) and guarantor subsidiaries cash and cash equivalents ("Available
Cash") plus our availability under our first lien revolving credit facility is
less than $275 million. If this were to occur, our ratio of EBITDA to
Consolidated Interest Expense may not be less than 2.0 to 1.0 for the most
recent period of four consecutive fiscal quarters. As of June 30, 2022, our
unused availability under this facility of $2,069 million, plus our Available
Cash of $342 million, totaled $2,411 million, which is in excess of $275
million.

In addition, our European revolving credit facility contains non-financial
covenants similar to the non-financial covenants in our first lien revolving
credit facility that are described above and a financial covenant applicable
only to GEBV and its subsidiaries. This financial covenant provides that we are
not permitted to allow GEBV's ratio of Consolidated Net GEBV Indebtedness to
Consolidated GEBV EBITDA for a period of four consecutive fiscal quarters to be
greater than 3.0 to 1.0 at the end of any fiscal quarter. Consolidated Net GEBV
Indebtedness is determined net of the sum of cash and cash equivalents in excess
of $100 million held by GEBV and its subsidiaries, cash and cash equivalents in
excess of $150 million held by the Parent Company and its U.S. subsidiaries, and
availability under our first lien revolving credit facility if the ratio of
EBITDA to Consolidated Interest Expense described above is not applicable and
the conditions to borrowing under the first lien revolving credit facility are
met. Consolidated Net GEBV Indebtedness also excludes loans from other
consolidated Goodyear entities. This financial covenant is also included in our
pan-European accounts receivable securitization facility. At June 30, 2022, we
were in compliance with this financial covenant.

Our credit facilities also state that we may only incur additional debt or make
restricted payments that are not otherwise expressly permitted if, after giving
effect to the debt incurrence or the restricted payment, our ratio of EBITDA to
Consolidated Interest Expense for the prior four fiscal quarters would exceed
2.0 to 1.0. Certain of our senior note indentures have substantially similar

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limitations on incurring debt and making restricted payments. Our credit
facilities and indentures also permit the incurrence of additional debt through
other provisions in those agreements without regard to our ability to satisfy
the ratio-based incurrence test described above. We believe that these other
provisions provide us with sufficient flexibility to incur additional debt
necessary to meet our operating, investing and financing needs without regard to
our ability to satisfy the ratio-based incurrence test.

Covenants could change based upon a refinancing or amendment of an existing facility, or additional covenants may be added in connection with the incurrence of new debt.

At June 30, 2022, we were in compliance with the currently applicable material covenants imposed by our principal credit facilities and indentures.

The terms "Available Cash," "EBITDA," "Consolidated Interest Expense," "Consolidated Net GEBV Indebtedness" and "Consolidated GEBV EBITDA" have the meanings given them in the respective credit facilities.

Potential Future Financings

In addition to the financing activities described above, we may seek to
undertake additional financing actions which could include restructuring bank
debt or capital markets transactions, possibly including the issuance of
additional debt or equity. Given the inherent uncertainty of market conditions,
access to the capital markets cannot be assured.

Our future liquidity requirements will make it necessary for us to incur
additional debt. However, a substantial portion of our assets are already
subject to liens securing our indebtedness. As a result, we are limited in our
ability to pledge our remaining assets as security for additional secured
indebtedness. In addition, no assurance can be given as to our ability to raise
additional unsecured debt.

Dividends and Common Stock Repurchases

Under our primary credit facilities and some of our note indentures, we are
permitted to pay dividends on and repurchase our capital stock (which constitute
restricted payments) as long as no default will have occurred and be continuing,
additional indebtedness can be incurred under the credit facilities or
indentures following the payment, and certain financial tests are satisfied.

We do not currently pay a quarterly dividend on our common stock.

We may repurchase shares delivered to us by employees as payment for the
exercise price of stock options and the withholding taxes due upon the exercise
of stock options or the vesting or payment of stock awards. During the first six
months of 2022, we did not repurchase any shares from employees.

The restrictions imposed by our credit facilities and indentures are not expected to significantly affect our ability to pay dividends or repurchase our capital stock in the future.

Asset Dispositions

The restrictions on asset sales and sale and leaseback transactions imposed by
our material indebtedness have not affected our ability to divest non-core
businesses or assets, and those divestitures have not affected our ability to
comply with those restrictions.

Supplemental Guarantor Financial Information

Certain of our subsidiaries, which are listed on Exhibit 22.1 to this Quarterly
Report on Form 10-Q and are generally holding or operating companies, have
guaranteed our obligations under the $800 million outstanding principal amount
of 9.5% senior notes due 2025, the $900 million outstanding principal amount of
5% senior notes due 2026, the $700 million outstanding principal amount of
4.875% senior notes due 2027, the $850 million outstanding principal amount of
5% senior notes due 2029, the $550 million outstanding principal amount of 5.25%
senior notes due April 2031, the $600 million outstanding principal amount of
5.25% senior notes due July 2031 and the $450 million outstanding principal
amount of 5.625% senior notes due 2033 (collectively, the "Notes").

The Notes have been issued by The Goodyear Tire & Rubber Company (the "Parent
Company") and are its senior unsecured obligations. The Notes rank equally in
right of payment with all of our existing and future senior unsecured
obligations and senior to any of our future subordinated indebtedness. The Notes
are effectively subordinated to our existing and future secured indebtedness to
the extent of the assets securing that indebtedness. The Notes are fully and
unconditionally guaranteed on a joint and several basis by each of our
wholly-owned U.S. and Canadian subsidiaries that also guarantee our obligations
under our first lien revolving credit facility (such guarantees, the
"Guarantees"; and, such guaranteeing subsidiaries, the "Subsidiary Guarantors").
The Guarantees are senior unsecured obligations of the Subsidiary Guarantors and
rank equally in right of payment

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with all existing and future senior unsecured obligations of our Subsidiary
Guarantors. The Guarantees are effectively subordinated to existing and future
secured indebtedness of the Subsidiary Guarantors to the extent of the assets
securing that indebtedness.

The Notes are structurally subordinated to all of the existing and future debt
and other liabilities, including trade payables, of our subsidiaries that do not
guarantee the Notes (the "Non-Guarantor Subsidiaries"). The Non-Guarantor
Subsidiaries will have no obligation, contingent or otherwise, to pay amounts
due under the Notes or to make funds available to pay those amounts. Certain
Non-Guarantor Subsidiaries are limited in their ability to remit funds to us 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.

The Subsidiary Guarantors, as primary obligors and not merely as sureties,
jointly and severally irrevocably and unconditionally guarantee on a senior
unsecured basis the performance and full and punctual payment when due of all
obligations of the Parent Company under the Notes and the related indentures,
whether for payment of principal of or interest on the Notes, expenses,
indemnification or otherwise. The Guarantees of the Subsidiary Guarantors are
subject to release in limited circumstances only upon the occurrence of certain
customary conditions.

Although the Guarantees provide the holders of Notes with a direct unsecured
claim against the assets of the Subsidiary Guarantors, under U.S. federal
bankruptcy law and comparable provisions of U.S. state fraudulent transfer laws,
in certain circumstances a court could cancel a Guarantee and order the return
of any payments made thereunder to the Subsidiary Guarantor or to a fund for the
benefit of its creditors.

A court might take these actions if it found, among other things, that when the
Subsidiary Guarantors incurred the debt evidenced by their Guarantee (i) they
received less than reasonably equivalent value or fair consideration for the
incurrence of the debt and (ii) any one of the following conditions was
satisfied:

•

the Subsidiary Guarantor was insolvent or rendered insolvent by reason of the incurrence;

•

the Subsidiary Guarantor was engaged in a business or transaction for which its remaining assets constituted unreasonably small capital; or

•

the Subsidiary Guarantor intended to incur, or believed (or reasonably should
have believed) that it would incur, debts beyond its ability to pay as those
debts matured.

In applying the above factors, a court would likely find that a Subsidiary
Guarantor did not receive fair consideration or reasonably equivalent value for
its Guarantee, except to the extent that it benefited directly or indirectly
from the issuance of the Notes. The determination of whether a guarantor was or
was not rendered "insolvent" when it entered into its guarantee will vary
depending on the law of the jurisdiction being applied. Generally, an entity
would be considered insolvent if the sum of its debts (including contingent or
unliquidated debts) is greater than all of its assets at a fair valuation or if
the present fair salable value of its assets is less than the amount that will
be required to pay its probable liability on its existing debts, including
contingent or unliquidated debts, as they mature.

Under Canadian federal bankruptcy and insolvency laws and comparable provincial
laws on preferences, fraudulent conveyances or other challengeable or voidable
transactions, the Guarantees could be challenged as a preference, fraudulent
conveyance, transfer at undervalue or other challengeable or voidable
transaction. The test to be applied varies among the different pieces of
legislation, but as a general matter these types of challenges may arise in
circumstances where:

•

such action was intended to defeat, hinder, delay, defraud or prejudice creditors or others;

•

such action was taken within a specified period of time prior to the
commencement of proceedings under Canadian bankruptcy, insolvency or
restructuring legislation in respect of a Subsidiary Guarantor, the
consideration received by the Subsidiary Guarantor was conspicuously less than
the fair market value of the consideration given, and the Subsidiary Guarantor
was insolvent or rendered insolvent by such action and (in some circumstances,
or) such action was intended to defraud, defeat or delay a creditor;

•

such action was taken within a specified period of time prior to the
commencement of proceedings under Canadian bankruptcy, insolvency or
restructuring legislation in respect of a Subsidiary Guarantor and such action
was taken, or is deemed to have been taken, with a view to giving a creditor a
preference over other creditors or, in some circumstances, had the effect of
giving a creditor a preference over other creditors; or

•

a Subsidiary Guarantor is found to have acted in a manner that was oppressive, unfairly prejudicial to or unfairly disregarded the interests of any shareholder, creditor, director, officer or other interested party.

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In addition, in certain insolvency proceedings a Canadian court may subordinate
claims in respect of the Guarantees to other claims against a Subsidiary
Guarantor under the principle of equitable subordination if the court determines
that (1) the holder of Notes engaged in some type of inequitable or improper
conduct, (2) the inequitable or improper conduct resulted in injury to other
creditors or conferred an unfair advantage upon the holder of Notes and (3)
equitable subordination is not inconsistent with the provisions of the relevant
solvency statute.

If a court canceled a Guarantee, the holders of Notes would no longer have a claim against that Subsidiary Guarantor or its assets.

Each Guarantee is limited, by its terms, to an amount not to exceed the maximum
amount that can be guaranteed by the applicable Subsidiary Guarantor without
rendering the Guarantee, as it relates to that Subsidiary Guarantor, voidable
under applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally.

Each Subsidiary Guarantor is a consolidated subsidiary of the Parent Company at
the date of each balance sheet presented. The following tables present
summarized financial information for the Parent Company and the Subsidiary
Guarantors on a combined basis after elimination of (i) intercompany
transactions and balances among the Parent Company and the Subsidiary Guarantors
and (ii) equity in earnings from and investments in any Non-Guarantor
Subsidiary.

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