Skip to main content
EVENT TRACKER
Keep track of rescheduled, canceled industry events with our COVID-affected event tracker - Powered by Snap Finance
Close
Sister Publication Links
  • Rubber & Plastics News
  • European Rubber Journal
tb-logo
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • OPINION
    • CORONAVIRUS
    • AUTO INDUSTRY
    • BUSINESS/FINANCIAL
    • COMMERCIAL TIRE
    • FACTORY FIXES
    • GOVERNMENT & LAW
    • INTERNATIONAL
    • MOTOR SPORTS
    • NEW PRODUCTS
    • RETAIL TIRES
    • SERVICE ZONE
    • SEMA/AAPEX
    • SMALL BUSINESS
    • TIRE MAKERS
    • SPONSORED CONTENT
    • TBC Corp. to make donation to company charity to reward vaccinated employees
      Titan to offer free COVID-19 vaccines at Iowa facility
      Bridgestone hosts vaccination events for plant employees
      Cioffi: Will remote working be the new normal?
    • Light trucks/CUVs to take 82% of new U.S. sales by 2028 — SEMA
      SEMA closes deal for SEMA Garage property in Michigan
      Conti adding dynamic driving simulator at German R&D center
      Yokohama gains OE fitments on BMW, Mercedes-AMG sport utilities
    • Ziegler Tire employees receive back pay after investigation
      Goodyear to add 'chatbot' feature to consumer-facing websites
      Prometeon's 2020 earnings off slightly on 15% lower sales
      Light trucks/CUVs to take 82% of new U.S. sales by 2028 — SEMA
    • Michelin adapts 'QuickScan' tire monitoring system to cars
      Prometeon's 2020 earnings off slightly on 15% lower sales
      Fisher: Expect robust recovery in last half of year
      Vipal targets North America for machinery sales growth
    • Ziegler Tire employees receive back pay after investigation
      Bridgestone part of Louisiana environmental settlement
      New York chipping in $3M+ toward Sumitomo factory expansion
      SBA extends and expands COVID-19 loan program
    • Goodyear to supply tires for World Tour bicycle racing team
      Michelin adapts 'QuickScan' tire monitoring system to cars
      Prometeon's 2020 earnings off slightly on 15% lower sales
      Goodyear to highlight international racing effort in ‘GoRacing' e-magazine
    • GT Radial named Formula Drift PROSPEC spec tire
      4WP partnering with CORVA to help protect off-roading in California
      Goodyear to highlight international racing effort in ‘GoRacing' e-magazine
      Goodyear goes retro for 'Throwback' NASCAR race at Darlington Raceway
    • Yokohama OHT adds severe-duty solid tire to Galaxy brand
      Bosch adds 22 aftermarket parts in Q1
      Snap-On introduces TreadReader handheld tire scanner
      Vogue Tyre introduces ‘biggest, boldest' red stripe tire
    • Ziegler Tire employees receive back pay after investigation
      Goodyear to add 'chatbot' feature to consumer-facing websites
      Michelin adapts 'QuickScan' tire monitoring system to cars
      4WP partnering with CORVA to help protect off-roading in California
    • Fisher: Expect robust recovery in last half of year
      Bosch adds 22 aftermarket parts in Q1
      Marinucci: Detailed instructions will save time
      Bartec introduces TPMS software updates
    • Light trucks/CUVs to take 82% of new U.S. sales by 2028 — SEMA
      WTC webinar to address tire/wheel-balancing process errors
      SEMA closes deal for SEMA Garage property in Michigan
      SEMA picks site in Michigan for 2nd SEMA Garage
    • SBA extends and expands COVID-19 loan program
      Stimulus spending should help tire industry
      Giti disputes report blasting tire maker for accepting PPP funds
      SEMA survey shows resilient auto aftermarket in 2020
    • Coopers are ready to rock: Cooper Tire, Alice Cooper seek best garage band
      Last Mile: Delivery surge raises demand for medium truck tires
      Nexen touting manufacturing quality milestone
      Apollo isn't planning U.S. plant — yet
    • Sponsored By Yokohama Tire Company
      7 questions to ask consumers when they need tires for a crossover SUV
      Sponsored By Yokohama Tire Company
      Stocking Tires for Crossover SUVs
      Sponsored By AppointmentPlus
      Three Important Lessons Learned for the Tire Business During a Pandemic
      Sponsored By Yokohama Tire Company
      7 questions to ask consumers when they need tires for a crossover SUV
  • SHOP FLOOR
    • BALANCING
    • DEMOUNTING
    • SAFETY
    • TIRE REPAIR
    • TPMS
    • TRAINING
    • VEHICLE LIFTING
    • WHEEL TORQUE
    • Video: Balancing Tire
      Choosing the right balancing equipment
      Safety tips for wheel balancing
      An introduction to wheel balancing
    • Video: Demounting
      Demounting Equipment
      Making rims ready for a tight seal
      Tire changer types, tips and trends
    • Video: Safety
      Making friends with OSHA
      Ergonomics on the shop floor
      Customers
    • Video: Tire Repair
      Tire repair: Shining a light on visual inspections
      Staying safe when repairing a tire
      Essential tools, materials and equipment for tire repair
    • Video: TPMS Service
      Decoding sensor data for TPMS diagnosis
      Replacement TPMS sensor overview
      The life-saving work of TPMS
    • Video: Training
      Advantages of apprentice program partnerships
      Options and resources for CE tech training
      Internship ideas to attract tech talent
    • Video:Vehicle Lifting
      Jack stands for commercial tire service
      All types of lifts for all types of work
      Tips and recommendations for lifting safety
    • Video: Wheel Torque
      Using torque sticks to speed service times
      The danger of too much, too little torque
      The importance of torque specifications
  • Multimedia
    • VIDEOS
    • PHOTOS
    • PODCASTS
  • Events
    • ASK THE EXPERT
    • LIVESTREAMS
    • WEBINARS
    • SEMA LIVESTREAMS
  • Data
    • DATA STORE
  • Resources
    • DIRECTORY
    • CLASSIFIEDS
  • ADVERTISE
  • DIGITAL EDITION
  • Awards
    • Tire Dealer Humanitarian Award
MENU
Breadcrumb
  1. Home
  2. News
January 06, 2015 01:00 AM

Michelin eyes growth in China, entry-level brands

Nick Gibbs, Crain News Service
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Group Michelin photo
    Michelin CEO Jean-Dominique Senard

    CHENGDU, China (Jan 6, 2014) — Group Michelin intends to counter rising pressure from fast-growing low-cost Chinese brands in Europe and North America by increasing the number of cheaper tires it offers from budget subbrands such as Tigar, Kleber and Riken, Michelin CEO Jean-Dominique Senard said recently.

    The French company, which ranks as the world's No. 2 tire maker, also aims to double its revenues in China in the next 10 years, Mr. Senard told Automotive News Europe Correspondent Nick Gibbs at last year's Challenge Bibendum event in Chengdu.

    Here are excerpts of that interview, which was conducted prior to the U.S. Commerce Department's decision to implement countervailing import duties on Chinese passenger and light truck tires:

    Michelin is under pressure from Chinese tire makers in mature markets. What has been the effect in Europe and North America?

    “The pressure is not in every segment and not in every country, but it's there. For example, in the passenger car business the import of Chinese tires into North America this year has been tremendous. There are also Chinese imports into South America and Europe, perhaps less so [than in North America], but it's not negligible.”

    What effect does this have?

    “This tends to have an impact on the price structure of the tire business. At the same time, we are not playing on the same field. We are a premium company more than anything else. While we are clearly present in the [lower price brackets], we need to be there more than we are today without being in direct competition with these tires.”

    What percentage of your tire sales is in those lower tiers now and what is the target?

    “Today, it's roughly 15 to 20 percent, it should probably move up to 25 to 30 percent in the next five to 10 years. We used to be big in these areas, but our recent strategy has been to make sure that we do not produce tires that destroy value.

    You were selling them too cheaply?

    “Yes, and we were producing them in areas where the cost base was too high. We had to dramatically restructure our business so we would stop bleeding cash and profit in Europe and in North America.

    Why go back?

    “We need to be there because our customers want Michelin Group tires but not necessarily all the performance of premium tires. Also, our distribution centers cannot live on just premium tires. They have to fill the racks with other brands, so if we don't offer these tires [under Michelin subbrands], they will go to the competition.

    “We can now manufacture these tires profitably and still offer good performance and safety. We will not sell nonpremium tires under the Michelin brand.”

    Do you foresee more people buying premium tires in Europe?

    “People will buy larger tires and wider tires. This aspect has been improving for years. You don't increase the number of tires, you increase the quality of the mix.

    How much will this improve?

    “We see it increasing by a few percent every year.”

    You want to double business in China over the next 10 years. What percentage of your business comes from China now and what could it be?

    “We do not typically disclose sales by region, but today our business in China is 1 billion to 1.5 billion euros [$1.2 billion to $1.8 billion], so it's not a huge part of the group [which had total sales of 20.2 billion euros on 2013], but it's growing significantly.”

    Could it become your No. 1 market?

    “It would take some time. We are strong in Europe and North America, but in the next five to 10 years China could certainly get to North American and European levels. The potential for growth is much larger in China than it is in Europe and North America as both could be flattish over the next 10 years for the domestic automotive and tire businesses.

    Is it your goal to pass Bridgestone to become the world's No. 1 tire maker?

    “I'm not sure it's the best goal to have in mind. We are a big player, and we are probably No. 1 or No. 2 depending on how you count things. Growth is at the center of our strategy, but it's not our target to be No. 1 for the sake of being No 1. I'd rather be No. 1 in technology and sustainable mobility.”

    _________________________________________________

    This Q&A appeared originally Automotive News Europe's January 2015 issue.

     

     

     

    Related Articles
    Michelin CEO talks sustainability at Challenge Bibendum
    Michelin to double sales of budget tires
    China CV duties effective Dec. 1
    Veterans make good employees — Michelin's Selleck
    Bib Challenge — 'Sustainable mobility' in urban settings
    U.S. lowers China import duty rates
    TB EDITORIAL: Keep up with fast-changing trends
    Michelin '14 sales, earnings down
    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Tire Business would love to hear from you. Email your letter to Editor Don Detore at [email protected].

    SIGN UP FOR NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Newsletter Center

    Staying current is easy with Tire Business delivered straight to your inbox.

    SUBSCRIBE TODAY

    Subscribe to Tire Business

    SUBSCRIBE
    Connect with Us
    • Facebook
    • LinkedIn
    • Twitter
    • RSS

    Our Mission

    Tire Business is an award-winning publication dedicated to providing the latest news, data and insights into the tire and automotive service industries.

    tb-logo
    Reader Services
    • Contact Us
    • About Us
    • Site Map
    • Industry Sites
    • Order Reprints
    • Customer Service: 877-320-1716
    Partner Sites
    • Rubber & Plastics News
    • European Rubber Journal
    • Automotive News
    • Plastics News
    • Plastics News China
    • Urethanes Technology
    RESOURCES
    • Advertise
    • Privacy Policy
    • Privacy Request
    • Terms of Service
    • Media Guide
    • Editorial Calendar
    • Classified Rates
    • Digital Edition
    • Careers
    • Ad Choices Ad Choices
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • OPINION
      • CORONAVIRUS
      • AUTO INDUSTRY
      • BUSINESS/FINANCIAL
      • COMMERCIAL TIRE
      • FACTORY FIXES
      • GOVERNMENT & LAW
      • INTERNATIONAL
      • MOTOR SPORTS
      • NEW PRODUCTS
      • RETAIL TIRES
      • SERVICE ZONE
      • SEMA/AAPEX
      • SMALL BUSINESS
      • TIRE MAKERS
      • SPONSORED CONTENT
    • SHOP FLOOR
      • BALANCING
      • DEMOUNTING
      • SAFETY
      • TIRE REPAIR
      • TPMS
      • TRAINING
      • VEHICLE LIFTING
      • WHEEL TORQUE
    • Multimedia
      • VIDEOS
      • PHOTOS
      • PODCASTS
    • Events
      • ASK THE EXPERT
      • LIVESTREAMS
      • WEBINARS
      • SEMA LIVESTREAMS
    • Data
      • DATA STORE
    • Resources
      • DIRECTORY
      • CLASSIFIEDS
    • ADVERTISE
    • DIGITAL EDITION
    • Awards
      • Tire Dealer Humanitarian Award