AKRON, OH -- The Goodyear Tire & Rubber Company has reported record second quarter tire business sales of $4.9 billion, up 4 percent from last year, offsetting softer conditions in several key markets with a richer product mix.

The sales improvement reflects the strength of Goodyear's new product engine as well as the performance of the company's three emerging markets tire businesses, which increased sales 15 percent over 2006. Each of these three businesses achieved record quarterly sales.

This growth, along with currency-driven sales gains in the European Union Tire business, offset a 3 percent decline in North American Tire sales, primarily due to the company's exit from certain segments of the private label tire business along with softer original equipment and commercial replacement markets.

"Our strong second quarter performance demonstrates successful execution against our strategies to improve our business and product mix as well as the early stage benefits of a lower cost structure," said Robert Keegan, chairman and chief executive officer.

"With the actions we have taken the past four and a half years, we have created strong platforms for growth going forward," he said. "Likewise, our improving balance sheet gives us the flexibility to increase investments aimed at growing our core consumer and commercial tire businesses."

Total segment operating income from continuing operations was $309 million, up 32 percent from the year-ago period, driven by significant improvement in North American Tire. All five of the company's regional tire businesses achieved higher segment operating income compared to the second quarter of 2006, with three setting records. Improved pricing and product mix of approximately $155 million in the second quarter of 2007 more than offset increased raw material costs of approximately $55 million.

Second quarter income from continuing operations was $29 million, or 14 cents per share compared to a 2006 loss from continuing operations of $33 million, or 19 cents per share. All per share amounts are diluted.

The 2007 quarter was also impacted by after-tax debt retirement expenses of $47 million, or 20 cents per share, rationalization and accelerated depreciation costs of $15 million, or 6 cents per share and a tax benefit to correct deferred taxes in Colombia of $11 million, or 5 cents per share. The second quarter of 2006 included $63 million, or 36 cents per share in after-tax rationalization and accelerated depreciation costs.

Including discontinued operations, Goodyear had second quarter net income of $56 million, or 26 cents per share, compared to $2 million, or 1 cent per share last year. All per share amounts are diluted.