Michelin reorganises its activities in UK, Italy, and Germany
The competitive environment and the economic crisis of the past few years have lastingly affected the European tire market and, in particular, the market for new and retread truck tires.
To maintain its position as leading manufacturer and continue to develop in Europe, Michelin has decided to consolidate its positioning on high added-value production.
With this in mind, Michelin undertakes a reorganization plan of its activities in the UK and in Italy. This will be accompanied by an investment of 265 million euros to modernise production facilities and the logistics network in these countries. The Oranienburg Pneu Laurent site in Germany will cease operations.
Italy is one of Michelin's major European bases. Michelin Italy manufactures over 10% of European production and employs more than 4,000 people, 80% of whom work on production sites. To address changing markets and maintain a strong base in Italy, the group has implemented a five-year strategic plan.
This will be supported by an investment of 180 million euros to significantly develop Italy’s car, van and truck tire volumes by 2020 by reinforcing its Cuneo and Alessandria sites.
The Michelin group has had operations in the UK for over one hundred years and is the country's leading tire manufacturer. Michelin Tyre PLC was established in 1905 and currently employs 2,500 people.
To adapt to changing markets and consolidate its presence in the UK, Michelin will be refocussing its activity on growth segments of the Passenger car & Light truck tire, and retread markets. Eighty five million euros will be invested in this strategy before 2020.
In Germany, fue to the serious difficulties experienced on the European retread market, Pneu Laurent will close its Oranienburg site at the end of 2016 and will group all of its activities at its French site in Avallon.
Pneu Laurent undertakes to implement a programme that is as comprehensive as possible to ensure that an appropriate solution for each of the 180 employees of the Oranienburg site is found.
To finance these projects of reorganisation, Michelin group will recognize a non-recurring impairment loss of around 280 million euros in 2015. ■