On the occasion of his “media day”, on October 25, the Tricolore Group presented its innovations in terms of tires, sustainable in particular. One way to answer Asian competition low cost.
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Co-number one world of tire with the Japanese Bridgestone, Michelin (20 billion euros in turnover in 2020) has been shaken for several years by the transformations of the road market, the heart of its sales ( 75% in 2019).
Like all historical pneumaticians, the Clermont-Ferrand firm has seen Asian builders disembark on its bands for ten years. “If the COVID crisis has disrupted logistical flows, adding the price of materials, created shortages, it has nothing changed to the geopolitics of the tire: there are still massive overcapacity in Southeast Asia” , summarized Florent Menegaux The president of Michelin during the media day organized in Clermont-Ferrand, headquarters of the company, Thursday, November 25. And these overcapacity generate exports at price levels deemed unfair.
This fact has social consequences for the industrial activity of Michelin in its historical locations. The closures, in 2019, from the plants of La Roche-sur-Yon (Vendée) and Bamberg (Germany) are the illustration. Michelin has no more truck tire mills in France today and its tricolore car tire sites are strictly oriented towards the very high-end.
One of the business responses is to go for growth outside the tire. At Horizon 2030, Michelin hopes to generate 25 to 30% of its turnover in services and activities such as the hydrogen stack or medical equipment. But, to date, the tire (road and other) represents another 95% of sales. The company must continue to innovate in this area as it has done for 130 years – Michelin puts 1 billion euros a year in innovation – while relying on five pillars carrying its expansion.
Take ahead in the renewable
Michelin’s “Media Day”, this Thursday, was devoted to “100% lasting tire challenges”. The objective of the company is to produce “100% biosourced or recycled” material tires in 2050, with a 40% step in 2030. Today, 28% of a Michelin tire consists of renewable materials, essentially natural rubber. Being a leader of the “green tire” can represent an advantage in markets where environmental awareness is a sales argument, but it mainly allows to be less dependent on oil.
Michelin multiplies partnerships to produce, from waste today petrosource. The Biobutterfly project (with axens a petrochemical) aims to produce butadiene, element of synthetic rubber (25% of a tire), with agricultural ethanol. The other molecule of synthetic rubber, styrene, will be extracted from polystyrene waste with the Canadian Start-Up technology PyroWave. Enviro, another start-up – Swedish it – manufactures carbon black (20% of a tire) from used tires cooked at very high temperatures. Finally, a Clermont-Ferrand company, Carbios, has developed enzymes that digest the old PET plastic to redo the new plastic fibers that will serve in the tire textile (7% of total material).
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