Michelin's sales up 12.2% in 1st quarter

Tire Business staff report

Paris -- Group Michelin's sales revenue jumped 12.2 percent in the first quarter on 15.3-percent higher unit sales, which reflected a sharp rebound in tire demand in most markets.

Michelin's sales for the three months ended 31 March rose to $5.46 billion (around Euro 4100 million), with the truck tyre business leading the way with a 20.4-percent jump in revenue. Michelin attributed the unit sales/sales revenue growth disparity to pricing that was virtually unchanged during the period and the above-average growth in OE tyres.

Michelin did not disclose earnings at this time but predicted 10-percent volume growth over the entire year “as mature economies gradually recover.”

The company said its truck tyre business sales grew to $1.68 billion in part due to purchases made ahead of announced price increases. Plant capacity utilisation improved throughout the period in line with the increased sales.

The truck tyre business reported replacement market growth in all geographic areas, including in North America, where gains reflected a “relative upturn” in freight and tighter conditions in the retread market.

In South America demand turned sharply upwards in Brazil, Michelin said, but more gradually throughout the Spanish-speaking areas. Demand in China surged 14 percent.

OE truck tyre demand surged in China and South America and rebounded in North America on renewed orders from trailer makers. Shipments in Europe trailed the 2009 quarter.

Michelin's consumer business reported 13.7-percent better sales of $3.07 billion, again in part because of purchases made ahead of announced price increases.

The specialty business reported a 7.8-percent drop in sales, to $716 million, on weak agricultural and aircraft tyre sales and reduced selling prices for mining tyres.

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Tire Business (a Crain publication)