Michelin Cuts 1093 Jobs in France
In a statement detailing the proposal’s Michelin representatives explained that the company plans to continue to produce premium passenger car tyres in France by transferring production from its Seclin facility to the Les Gravanches plant near Clermont-Ferrand. Meanwhile the manufacturers said it is aiming to strengthen light truck and SUV tyre production operations at its Cholet plant by integrating light truck tyre production from one of the Group’s European plants. Bloomberg quoted Michelin spokesmen Fabrice Lenica as saying that this is “a plant in Germany.”
Responding to earlier media reports that such an announcement was imminent, Deutsche Bank analysts said that the French manufacturer’s decisions to reduce its French workforce by almost 10 per cent “is not surprising when worldwide volumes have declined by approximately 20 per cent over the last nine months.” Putting the company’s (and the industry as a whole’s) difficulties into perspective, the analysts added that the worst volumes are currently “eight times worse than the worst year over the last 30 years (1991)” Nevertheless Deutsche is still banking on a recovery: “We are still betting that volumes are too low to last (the number of kilometres driven is only 5 per cent lower and freight traffic 12 per cent lower). And when they’ll recover, the leverage on earnings will be significant. However, according to Bloomberg, Michelin shares fell as much as 1.85 euros, or 4.3 per cent, to 41.12 euros, following the news of job cuts.