Michelin cites Covid for output cut at US aircraft tire plant

Norwood, North Carolina – Michelin North America Inc.'s aircraft tire plant in Norwood is operating at reduced hours due to the economic impact of Covid-19, the company said in a recent letter to the North Carolina Department of Commerce.

"We remain hopeful that these restrictions will be temporary. However, it is possible that there will be longer-term restrictions on the site's ability to operate at full capacity," the letter states.

Michelin updated state officials on conditions at the plant as part of the Worker Adjustment and Retraining Notification (WARN) Act, the letter reads. WARN provides workers notice of significant changes to employment at locations with at least 100 workers.

Factors cited by Michelin in the letter include continued spread of Covid-19, social-distancing orders, disruptions to the supply chain, reduced consumer demand and the impact the pandemic is having on airlines.

"This notice is being provided under the federal WARN Act out of an abundance of caution," Michelin states in the letter. "We hope that business conditions will allow operations to resume to greater capacity within six months, but because of the uncertainty surrounding the Covid-19 pandemic, it is possible that the need for reduced hours will last longer."

Michelin indicated its policy is not to report what the company calls "region-specific information regarding business conditions."

Michelin did, however, provide some insight into the impact the pandemic is having on business.

"As a result of the continued effects from the crisis, some of our factories have operated at lower levels of production due to market conditions," the company said in a statement in response to questions regarding the Norwood location.

According to the company, on 1 June, Michelin extended rotating schedules and reduced hours implemented in March.

The extension, it said, would continue until “market conditions allow the site to resume operations at higher capacity." 

The WARN notification covers roughly 425 workers at the Norwood plant, Michelin said. The company indicated that "these prolonged business circumstances were not foreseeable when the furloughs began."

Greenville, South Carolina-based Michelin North America is a unit of Group Michelin, the world's second-largest tire maker.