PARIS (Oct. 25, 2004) — Despite a sales slowdown in the third quarter, Group Michelin still expects to meet its fiscal 2004 operating goals because of higher selling prices and the effects of an improved product mix.
Michelin's sales in the quarter rose 1.1 percent to $4.71 billion, as tire demand growth globally slowed markedly during the period, the tire maker said, to more historical rates from “exceptional” growth in the first half. Michelin's sales for the nine months ended Sept. 30 were up 4.6 percent to $14.3 billion.
Michelin did not disclose earnings at this time, but said the pricing and product mix effects will continue to help offset raw material price increases.
Regarding its key segments, Michelin said passenger and light truck unit tire sales were up 1.2 percent for the nine months, with replacement sales up 3.9 percent and original equipment down 5.1 percent.
Replacement unit sales in North America fell 4.2 percent in the quarter because of an overall slowdown in the market and supply problems caused by a strike at the company's BFGoodrich plant in Kitchener, Ontario. Nonetheless, the company said its flag brands improved their market shares in the sport-utility vehicle and peformance segments.
Truck tire unit volume was up 5.9 percent globally with OE demand in Europe and North American growing at a double-digit pace for both the quarter and nine months. Replacement market growth slowed in the quarter, although the trend in North America was mixed: down in the U.S. and up significantly in Canada and Mexico, which benefited from economic recovery.