GREENVILLE, S.C. (May 14, 2009)—Michelin North America Inc. has agreed to pay 17 states $375,000 for the cost of the investigation of alleged misrepresentations in advertising of its fuel efficient tires and modify the ads' claims.
The Tennessee Attorney General's office led a multi-state probe into the promotional claims made by the Greenville-based tire maker after full-page ads of Michelin-brand fuel efficient tires ran in the Wall Street Journal and USA Today in 2008. Michelin also advertised the tires on radio and television ads on ESPN.
Besides Tennessee, the states involved in the investigation include Alaska; Arizona; Delaware; Iowa; Kentucky; Massachusetts; Montana; New Hampshire; New Mexico; North Carolina; Ohio; Pennsylvania; Rhode Island; Texas; and Vermont.
The ads had taglines of “It's time to fight back. Michelin fuel-efficient, long-lasting tires help you save money” and “Michelin makes the most fuel-efficient line of tires on the road, which saves you money over the life of your tires.”
The investigation—brought about following a complaint by Bridgestone Americas Holdings Inc.—focused on Michelin's claims, type size and footnote disclosures in the advertising. The states allege that Michelin's fuel efficiency ads did not adequately disclose that the advertised costs savings were based solely on savings in fuel costs, not on the comparative costs of the competing tires. The ads did not mention consumers may save more money by buying a cheaper tire or other cost-saving factors, according to the states.
Michelin said it presented test data to the states demonstrating a major advantage in rolling resistance and related fuel-efficiency compared to most tires in its competitive set.
The $375,000 multi-state settlement is to cover the costs of the investigation for the various attorneys general, said Scott Clark, COO of Michelin Americas Small Tires.
Additionally, the tire maker also will modify the ad messages and increase the font size on the disclaimers that show which competitors Michelin is comparing itself against, Mr. Clark said.
The new tagline, scheduled to appear May 15, will read: “It's time to fight back. Michelin makes some of the most fuel-efficient tires, which help you save money at the pump.”
It replaces the former ads' claims of “the most fuel-efficient” with “some of the most fuel-efficientà.”