Goodyear Tire & Rubber Co. (GT) swung to a second-quarter loss of $221 million as the company reduced product shipments in the wake of auto maker production cuts.

Tire sales fell in all of Goodyear's regions, especially in North America and Europe which reflected the biggest decline in auto maker orders. Shipments to North American auto makers dropped by more than half while Europe declined 33%.

"There is little debate as to the severity of the economic and industry downturn we have experienced the past three quarters," Goodyear Chief Executive Officer Robert Keegan said in a statement Thursday. "We are beginning to see some signs of economic stabilization and recovery, although still fragile at this stage and varied around the globe."

Goodyear, which sidestepped most of the economic problems of 2008 by producing and selling more high-end tires, is now resorting to more plant closures, job cuts and price increases to traverse the ongoing worldwide recession. The company cut 5,500 jobs though June, 500 more than its full-year target.

For the quarter, the Akron, Ohio-based company's net loss was 92 cents a share compared with a profit of $75 million, or 31 cents a share. Excluding one-time charges, Goodyear reported a loss of 35 cents, beating analyst estimates of a loss of 70 cents a share according to Thomson Reuters. Sales fell 25% to $3.9 billion.

The one bright spot was the Asia-Pacific region which reported a record $57 million profit. Much of the profit was attributed to cost reductions that included the closure of an Australia plant. The unit also sold tires at higher prices.

Shares of Goodyear, North America's largest tire maker, closed Wednesday at $13.89 and were down 1% at $13.75 in premarket trading Thursday. The shares have declined 27.5% over the past 12 months.

-By Jeff Bennett, Dow Jones Newswires; 248-204-5542; jeff.bennett@dowjones.com