Michelin & Cie. named Jean-Dominique Senard to succeed Michel Rollier as chief executive officer. The tiremaker also pledged to make the position more accountable to investors.
Senard will receive a renewable four-year contract, subject to extension by the supervisory board, Michelin said. The move breaks the position’s traditional lifelong mandate.
Senard, 58, joined Michelin in 2005 as finance chief after holding senior executive roles at Total SA, Cie. de Saint-Gobain and aluminum-maker Pechiney. Michelin said shareholders will vote May 13 on the proposal to appoint Senard as a general managing partner alongside Rollier, 67, who will remain for at least 18 months. For the first time, the supervisory board will have a veto on managing-partner appointments and renewals.
The announcement came at the same time the tiremaker reported its 2010 financial results, which included an 21% increase in revenue, to 17.9 billion euros.
Michelin raised 1.2 billion euros in a share issue last September to finance expansion plans that include factory investments in India, Brazil and China. The tiremaker aims to add the equivalent of a new plant each year to meet demand growth averaging 9% in emerging markets.
“These are markets we can’t ignore if we are to participate in global growth to the extent we’d like,” Senard said in an interview. The company’s low debt means “we don’t have to ask ourselves too many questions if we need to move.”
Due to material costs and investment commitments, Michelin said it will see a “temporarily negative” cash flow in 2011, with the goal of achieving positive cash flow for the period from 2011 to 2015. Sales volume growth will slow to 6.5% this year from 13.4% in 2010, Michelin forecast.
