Updated from 12:24 p.m.

Goodyear Tire & Rubber

(GT) - Get Report

, the world's biggest tire company, said Thursday that its second-quarter earnings would fall well short of estimates because of fierce competition.

Goodyear expects earnings, before charges, to be in line with the 37 cents a share it earned a year earlier, far short of Wall Street's estimate of 58 cents, according to analysts surveyed by

First Call/Thomson Financial


The company said its second-quarter estimate reflects an increasingly competitive environment in many markets around the world.

Goodyear shares fell 2 21/256, or 9%, at 21 1/4 Thursday. Goodyear shares have tumbled around 17% since the company first disclosed earlier this month in a newsletter to investors that its price increases have met resistance and hampered sales. Thursday's announcement disclosed the earnings impact that the lower sales volume will have.

"While the books have not yet closed on June, it has become clear that we will not be able to overcome the volume shortfall from April," said Samir G. Gibara, chairman, chief executive and president of the Akron, Ohio-based company, in a statement. "We had anticipated that volume would fall as a result of our price increases in March and April, but expected to regain the business as competitors took their own pricing actions."

Gibara said competitors have actually cut prices despite an increase in costs, and those price cuts have hurt Goodyear's sales volume.

The company had promised "significant year-over-year improvement" for the second quarter, said Glenn Chin, a

Lehman Brothers

analyst. "Obviously, they're not doing that." His firm rates the stock a neutral and has not done any underwriting for the company.

Goodyear will release second-quarter earnings July 24.

Goodyear's revised earnings outlook was one of two unveiled Thursday. Investors



(UIS) - Get Report

, an information technology company geared toward business customers, after the firm said its second-quarter earnings will only be about half of what Wall Street analysts had expected.