Goodyear Tire’s Chief Executive Resigns

Goodyear Tire & Rubber Co., facing mounting losses, said Tuesday that Chairman and Chief Executive Tom Barrett had resigned after two years at the helm of the world’s biggest tire maker.

The board elected Stanley Gault, former chairman and chief executive of Rubbermaid Inc., to replace Barrett under a three-year contract. Gault has been a director of Goodyear since 1989.

The surprise announcement by the company’s board--effective immediately--jolted Goodyear’s stock on Wall Street. The shares climbed $2.25 to $29.25 in New York Stock Exchange trading--an apparent endorsement of the move.

Several analysts said they expect Goodyear’s fortunes to revive under Gault.

“Gault has an absolutely stellar reputation, and you can make tremendous changes in three years,” said Scott Merlis of Morgan Stanley & Co.

Gault, 65, headed Rubbermaid from 1980 to early 1991, when sales jumped five-fold and earnings more than six-fold. Goodyear made a special waiver of its rule on mandatory retirement at age 65 to hire him.

Goodyear has cut its staff and restructured its operations to try to deal with increased competition in the world tire market.

In two years, its work force has fallen by 10,000 to 105,000 workers.

In the first quarter of 1991, the company lost a whopping $90.1 million. That came after an $11.6-million fourth-quarter loss.

The company said in April that it expected improvement if the economy rebounds. There have been signs that the 11-month recession is flagging, but many economists expect a tepid recovery.

Barrett, 61, an engineer by training, joined Goodyear in 1953 and rose steadily through the ranks. He became president and chief operating officer in 1983 and was named to the company’s top posts in 1989.