CLERMONT-FERRAND, France (Oct. 11, 2006) — Group Michelin is planning to revamp two of its plants in France, concentrating their production on one type of tire each to improve their competitiveness.
Michelin presented the plan yesterday to the secretary of the Central Workers Committee at its plants in Bourges and Cholet, France.
The tire maker intends to transfer light truck tire output from Bourges to Cholet and concentrate production at Bourges on radial aircraft tires. This change will make both plants “benchmark production centers in their respective lines in Europe,” Michelin said, and “enhance their technological excellence and competitive edge.”
This transfer, for which Michelin has budgeted $29 million, will increase Cholet's annual capacity for light truck tires 60 percent to about 4 million units, the company said, boosting the plant to a size large enough to “resist competitive pressure on the world market.” Two-thirds of Cholet's production is exported, Michelin said.
At Bourges, Michelin will invest $21.4 million starting next year to double capacity for radial aircraft tires, supporting what the company calls a “massive switch” to radials by the aircraft industry, both commercial and military. Michelin has invested nearly $14 million in Bourges over the past four years in a drive to make it the “world's benchmark” for radial aircraft tires.
By 2008, the plant will account for more than half of Michelin's radial aircraft tire production.
Michelin did not say what effect the changes will have on employment, but did say the project is a further step in its strategy of optimizing its industrial facilities in France in order to have a competitive and sustainable production base in the country.