GREENVILLE, S.C.—Following an interview Tire Business conducted with Pete Selleck, Michelin Americas Small Tires (MAST) chief operating officer, the tire manufacturer has issued a clarification on its "Maximum Value Policy" (MVP) on certain light truck tire lines.
In the subsequent statement, Michelin said it wanted to be more "precise" about a point Mr. Selleck made in the question-and-answer-type article published in the March 26 Tire Business. In it, Mr. Selleck was asked whether Michelin controlled prices under the MVP program as it relates to the company's BFGoodrich Radial All-Terrain T/A KO and All-Terrain T/A tires.
Michelin's clarification follows:
"Mr. Selleck responded, `That is a contract that a customer enters into in order to receive the product.' In that explanation, we should not have used the word `contract.'
"The MVP is a legal distribution policy that was unilaterally adopted by MAST on May 1, 1999, and is only applicable to the BFGoodrich Radial All-Terrain T/AKO and All-Terrain T/A tires. Under this policy, MAST does not seek, obtain or sign any agreement or contract with its customers regarding their adherence to the MVP.
"Each customer must decide on its own whether it wishes to purchase these tires pursuant to the MVP.
"Further, MAST sales personnel have no authority to discuss the MVP with its customers, other than logistical ordering issues, and they cannot modify the policy in any manner. MAST does, however, reserve the right to terminate the All-Terrain purchasing privileges of any customer who chooses not to follow the MVP.
"MAST customers are free to charge whatever prices they wish for any MAST product.
"Separate and apart from the MVP, when a customer wishes to purchase MAST products directly from MAST, the customer and MAST entered into what we typically refer to as a Dealer Agreement. We want to reiterate that neither the Dealer Agreement nor the Maximum Value Policy seek an agreement or contract from our customers regarding their resale prices of our products."