Fitch downgrades Goodyear

Fitch Ratings said it has downgraded the Goodyear Tire & Rubber Co.'s senior unsecured rating to CCC+ from B and the senior secured bank facilities to B from B+.

The outlook remains negative.

Fitch said the rating action is based on lack of resolution in the investigation and review of the company's accounting practices and certain reported financial statements. An informal inquiry by the Securities and Exchange Commission prompted by two previous company announcements (December and October 2003) of accounting problems has now escalated into a formal SEC investigation.

These latest issues have further delayed the filing of timely financial statements and could hinder Goodyear's access to credit facilities and external capital markets. Access to significant external capital is required to meet heavy debt maturities, pension funding requirements, and other cash needs over the next few years.

Fitch said the delays and questions surrounding the company's financial statements have precluded the ability to track the progress of the company's critical cost restructuring program. Furthermore, Goodyear appears not to have met the terms of its latest union contract which required the company to raise external financing prior to year-end 2003.

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