Michelin plans cost-cutting moves

PARIS (Oct. 22)—In light of uncertain economic conditions next year, Groupe Michelin will cut nearly 4,600 jobs through an early retirement program in France and three plant closures. The moves will cost the company $180 million in charges against 2001 earnings. In addition, the company is putting employees and investors on notice that it does not rule out "additional steps to adjust production capacities." The plant closings are in England and Germany. For the third quarter of fiscal 2001, Michelin saw sales edge up 1.9 percent to $3.57 billion, while nine-month sales were up 3.6 percent to $10.5 billion, despite a 2.4-percent drop in unit volume. Earnings were not released at this time. In North America, the company claimed it gained market share in both the original equipment and replacement passenger tire markets, and it recouped nearly all its lost market share in the truck tire aftermarket. Michelin said it expects to cut annual operating costs by nearly $135 million next year and in 2003, and by an additional $135 million starting in 2004.