PARIS (June 17, 2009)—Looking to streamline its business in France, Michelin will restructure operations at four plants, invest more than $140 million in its research and development activities and trim employment by about 600 through early retirement options.
The aim of the project, which will include one plant closing, is to make the company more competitive in a tough economic environment.
In all, Michelin said 1,093 employees would be affected by the moves. Of these, 495 will be offered early retirement, linked to pre-retirement phase-down, while 598 will be offered other jobs within the company.
The high-performance passenger tire plant at Seclin in northern France will close and production transferred to Gravanches, close to Clermont-Ferrand.
Michelin will modernize the R&D center at its headquarters in Clermont-Ferrand, focusing on accelerating product innovation and bringing new products more quickly to market. It will also improve Michelin's production processes.
The factory at Montceau-les-Mines will become focused on OTR tires for the civil engineering and construction industries and will become one of the firm's two largest rubber mixing centers in Europe.
The existing capacity there for passenger tires will be phased out and spread among other factories in Western Europe, Michelin said. It has budgeted nearly $70 million for these changes.
Michelin's plant at Tours will be focused on heavy truck tires, including resources devoted to their technology. At the same time, mixing operations there will be phased out, with compounds being sourced from the centers at Montceau and Cholet. This will involve an investment of $21 million.
The plant at Cholet will be focused on light truck tires, including those for four-wheel-drive vehicles. This will involve the transfer of production of these type tires from other factories in Europe, Michelin said.
Michelin said it sincerely wants these people to continue working for Michelin and each will be offered at least two other jobs in the company. In addition, Michelin said it plans to hire roughly 500 a year over the coming three years to replace retiring workers.
Michelin also said it will launch a development program to revitalize the regions impacted by the reorganization.