Michelin's decision to halt truck tire production in Olsztyn (Poland), in the face of competition from low-cost Asian products, and in Shenyang (China), this time due to the sluggishness of the local market, will contribute to reducing the group's global production capacity by 15%, its CFO said on Wednesday.

As part of the ongoing adaptation of its industrial facilities, Michelin announced locally this quarter the conversion of two plants to the production of car tires. These decisions come on top of the closure of its truck tire sites in Karlsruhe and Homburg, Germany, announced for the end of 2023.

In Europe, Michelin's truck tire production facilities will henceforth be concentrated on Spain, Italy and Romania.

During a teleconference with analysts organized on the occasion of the publication of quarterly sales that were down more than expected, due in particular to sluggish demand for truck and specialty tires, Yves Chapot also indicated that the industrial adjustments announced in 2023 and 2024 would reduce the Group's production capacity in smaller car tires by 7%.

Building on its premium positioning, Michelin is focusing on larger tires, 18 inches or more, which are better suited to SUVs and electric cars, whose high weight and torque they can handle better.

"Michelin's priority is to support people through these changes," added Michelin on Wednesday in its earnings release.

The closure of the truck activity in Olsztyn, whose passenger car and light truck tire activity will be modernized, will have no impact on jobs, a group spokesperson said, as the people concerned "will move on to new activities in line with this refocusing".

(Gilles Guillaume reports, edited by Zhifan Liu)

by Gilles Guillaume