Michelin Restructures French Operations

Michelin & Cie. plans to invest €800 million in its French business through 2019 as part of a restructuring that include ending production of heavy-duty truck tires at its factory in Joue-les-Tours, France, by the first half of 2015.

Michelin will consolidate truck tire manufacturing at its plant in La Roche-sur-Yon. The company pledges to invest €100 million to retool and double the facility's annual capacity to 1.6 million tires. Three-quarters of the output will be sold outside France.

Michelin adds that it also will end heavy-truck tire production at its factory in Algeria by year-end. Algerian conglomerate Groupe Cevital has agreed to buy the unit in two stages for an undisclosed price.

The balance of Michelin's investment will be spent at other French facilities, including €220 million for R&D. The six-year plan will add about 1,700 new jobs, the company says.

Europe's demand for heavy-truck tires has dropped by one-quarter since 2007, according to Michelin. It disclosed last month that its heavy-truck tire factories are operating 50%-60% of capacity.

The company will take a €135 million one-time charge in the first half for the plant actions.