Michelin Reports Increased Sales in Q3, Revises 2019 Forecasts - Tire Review Magazine

Michelin Reports Increased Sales in Q3, Revises 2019 Forecasts

In weaker than expected markets, the Michelin Group reported a 1.3% increase in sales like-for-like in the first nine months of 2019, according to the company’s third quarter financial report.

In weaker than expected markets, the Michelin Group reported a 1.3% increase in sales like-for-like in the first nine months of 2019, according to the company’s third quarter financial report. It also reported that its contributions from its acquisitions was +7.1% in line with its expectations.

In the report, the company reported its volumes declined by 0.8% in the first nine months of 2019 due to: a contraction in automotive tire volumes, in line with the markets and sustained growth in the 18-in. and larger segment; a decline in truck tire volumes in increasingly difficult markets; growth in the mining tire business, in line with expectations; and a steeper than expected drop in the agricultural and construction tire markets.

It also reported a 2.1% improvement in the price-mix effect, attributable to disciplined price management, in particular with price increases in the third quarter, as well as a strong mix effect, shaped by a favorable business-mix and a firm product-mix in the automotive segment, Michelin reported.

“In response to a market downturn that was sharper than expected, particularly in the truck segment, the Group is continuing to improve the competitiveness of its operations, carefully manage its prices and strengthen its positions in the fastest-growing segments and businesses,” said Florent Menegaux, Michelin CEO. “In these challenging times, I would above all like to commend all our teams for their engagement and hard work in limiting the impact of this unfavorable environment.”

During the third quarter, the company reported that its North American replacement tire business climbed 3% over the first nine months, with a much faster 7.5% gain in the first quarter. Demand is being driven by Asian tire imports, with the pool market up slightly for the first nine months, the company said.

Michelin also edited its fourth-quarter forecasts and 2019 guidance, which included:

  • In 2019, the passenger car and light truck tire markets are expected to decline by 1%, as the modest 1% growth in the replacement segment fails to offset the steep 6% contraction in the original equipment segment;
  • Truck tire markets are expected to weaken more quickly in the fourth quarter to end the year down 4%. Specialty tire markets will probably remain stable over the full year, as sustained demand for mining and aircraft tires helps to cushion the sharp contraction in the agricultural and construction markets;
  • The full-year impact of raw materials costs and customs duties is estimated at around a negative €100 million.

In this scenario, Michelin confirms its guidance for 2019, with volume growth in line with global market trends; segment operating income exceeding the 2018 figure at constant exchange rates and before the estimated €150 million ($166 million) contribution from Fenner and Camso; and structural free cash flow of more than €1.45 billion ($1.61 billion).

You May Also Like

CEAT Receives Lighthouse Certification from World Economic Forum

The certification is given to manufacturers that use Industry 4.0 technologies.

CEAT-receives-Lighthouse-certification-

CEAT Ltd.’s Halol plant has been awarded the Lighthouse Certification by the World Economic Forum. The certification is given to manufacturers that use fourth-industrial revolution technologies (Industry 4.0) to transform factories, value chains and business models for sustainability, empowering the workforce and increasing in productivity, the company says.

Nokian Tyres Holds Innovation Challenge Finals

Sustainability at the top of mind for Nokian Tyres during its innovation challenge.

Nokian-Tyres-1400
Apollo Tyres Receives ISO Certification for Sustainability

Apollo Tyres underwent a three-stage assessment for the certification.

apollo-chennai-india-plant-sustainability
Discount Tire Announces ‘Defending Daytona’

The series will highlight Austin Cindric, driver of the No. 2 Discount Tire Ford Mustang, as he prepares to defend his title at the Daytona 500.

Discount Tire Defending Daytona
Hunter’s BL Series Bench Lathes Now Connects with HunterNet 2

With the new connectivity, shop owners and managers will be able to view before and after-cut results for rotors and drums online.

brake-bl-bench-lathe-hunter-engineering

Other Posts

GRI Receives US DOT Certification for Safety

GRI tires will now have a DOT code embossed on their sidewalls.

DOT-CERTIFICATION-GRI-Tires
BKT Launches New Website

Each product page now contains more information, including videos and links to case studies.

BKT website
Pirelli Revs Up for 2023 Motorsport Season in the US

The Italian tiremaker is set to participate in 10 North American motorsport championships.

Pirelli-Motorsport
Fortune Tires Debuts new US Dealer Website

Current Fortune dealers can access a range of dealer resources, including product information and marketing materials.

Fortune-Tires-new-website