Word: tires
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Dates: during 1970-1979
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...Ashland Oil, Inc. ($100,-000), American Airlines ($55,000), Goodyear Tire & Rubber...
...seeking to shrink some of the nation's very biggest companies. In 1972 the division asked the federal courts to order a breakup of IBM. Now it is demanding that Goodyear and Firestone, two giants of the rubber industry, get rid of enough operations to make the tire business as competitive as it was in 1959-when Goodyear accounted for 23% of sales, against 28% now, and Firestone's share was 15%, v. a current 25%. Justice Department lawyers warn that the companies will not be able to do that merely by disposing of other concerns that they...
...separate suits filed last week in federal court in Cleveland, the Government accused the rubber companies of a pattern of predatory acts aimed at monopolizing the replacement-tire market. (The companies, it concedes, did not conspire with each other, but followed the same course independently.) Between 1959 and 1966, the suits allege, Goodyear and Firestone cut prices to levels that smaller competitors could not meet. When the rivals ran into financial trouble, the Government charges, the rubber giants bought them out in whole or part, took over their product lines and distribution networks-and jacked prices back up across...
Freeze-Outs. Goodyear and Firestone are also accused of freezing smaller firms out of large portions of the replacement-tire market by signing oil companies to so-called T.B.A. (for tires, battery and accessory) agreements. Under these, an oil company agrees to sell exclusively only one rubber company's tires through its gasoline stations in exchange for a commission from the tire manufacturer. Legal battling over such agreements began in 1951 when the Federal Trade Commission attacked a T.B.A. contract between Goodyear and Atlantic Richfield Co. In 1965 the Supreme Court upheld the FTC, and three years later...
...their customers well, and that the companies they acquired were incapable of surviving independently in a bitterly competitive business. Industry sources point out that Firestone bought out Seiberling Rubber Co., one of the acquisitions challenged by the Justice Department, only after getting feelers from the financially rocky firm. Lee Tire & Rubber had not produced a single tire in the past 30 months before it was acquired by Goodyear in 1966. Firestone issued a statement saying that the Government suit against it "is absurd and untenable and has no foundation in economics or law." In its view, traditional among antitrust defendants...