EXCLUSIVE MAINTENANCE. "The La Roche-sur-Yon site was deadlocked," says Michelin's president

After weeks of worry, Michelin's management met with employees at the La Roche-sur-Yon site on Thursday morning to announce its decision to close the Vendée truck tire plant at the end of 2020. Florent Menegaux, Chairman of Michelin, explains.

Michelin's France management gathered employees at the La Roche-sur-Yon plant this morning to announce its decision to close its truck tire plant at the end of 2020. In an interview with Ouest France, Florent Menegaux, president of Michelin, explains the reasons for this choice.

You announce, this morning, the closure of your La Roche-sur-Yon plant at the end of 2020. Why this decision?

It's very difficult. If I could do otherwise I would have done it. For years, we have tried to maintain the site, but we can not, the market conditions no longer allow it. But before detailing the reasons that led me to make this decision, I first want to talk about the future of the 619 employees concerned.

What will you offer them?

My preference is to see them join another Michelin factory, if they wish. We are able to offer everyone a job at Michelin in France. But I can understand that we can not move, especially when we have family in the area. We will find a solution for everyone. I commit myself to it. Michelin is going to put in place devices, which I will not give you the details today, because we want to build them with the social partners, which is quite novel. There will also be opportunities for early retirement.

In concrete terms, what would these accompanying measures consist of?

In a project of professional reconversion, we know that the fabric of companies in Vendée is very dynamic. For each person, we must know his aspirations, his constraints, his desires, evaluate his skills. Michelin will do everything it can to do it. For each of the 619 employees, we must find a solution that suits him. Although it is inevitably a difficult period to live.

Promise to accompany, it remains a bit vague. What means will be deployed?

We have plenty of toolboxes and we will put the necessary means. In particular our subsidiary Michelin Development whose mission is to connect jobs with people and companies able to recruit.

Michelin is the second largest private employer in the city. This closure will affect more than 600 families. It's a disaster locally ...

I understand and it will generate a lot of emotion. But it was necessary to make a decision, not to leave the employees in uncertainty. After the shock of the announcement, we will enter a phase of construction, of dialogue. We must manage to mourn the manufacture of truck tires in La Roche-sur-Yon to devote to the after. We will meet local businesses, elected officials, the department, the region ... With one goal: revitalize employment on the territory.

How? 'Or' What ?

By creating new jobs on the site that we will close, via a public-private partnership. We can not imagine the maintenance of a tire production activity, but there will certainly be other activities to be developed on this site. Michelin will be there until we have recreated at least as many jobs as those we are going to remove. We will stay until it is done. We are sure that the La Roche-sur-Yon site can be attractive for industrialists. We planned the closure of the plant in late 2020 to give us time to build something solid.

So far, local actors have not been associated. Why ?

Because it was too early to do it.

And what can you imagine together?

Take the example of our site in Dundee, Scotland (845 employees), whose closure we announced almost a year ago and whose production will stop at the end of June. Michelin has set up a company to host digital start-ups, renewable energies ... It is developed in partnership with local authorities, we will attract businesses and create jobs. For a euro invested by Michelin, the Scottish public authorities put one euro.

What happened to Dundee employees, eleven months after the announcement of the closure?

276 have found another job, 74 have retired. 500 continue to work on the site. The production plan is constantly reorganized to allow employees who find another job to leave without delay.

Will the decision to close La Roche also have an impact for the Cholet site (Maine-et-Loire) at the end of 2020?

Yes, 74 of the 1,338 site employees make blends for La Roche-sur-Yon. They will see their jobs disappear, but not their jobs. They will all find a job in the Cholet plant, which has recruitment needs.

Florent Menegaux, President of Michelin. | DANIEL FOURAY / WEST FRANCE

What makes the Roche site no longer competitive enough and pushes you to make such a radical decision?

The site is small and, despite the investments we have made to try to give it a critical size, it is not sufficiently efficient in terms of industrial cost. At the same time, the European truck tire market is decreasing sharply. This market was 197 million tires worldwide in January. It dropped below 190 million in September. 7 million tires lost in a few months. In addition, the La Roche site has the worst performance of all our European sites. I prefer to find a new solution rather than persevere in an untenable way.

Why this collapse of the market?

There are two phenomena: Asian tires have invaded the market. Five years ago, they were still marginal. Today, they represent one third of the market. At the same time, we have a global economic slowdown that makes trucks less of a truck because they have fewer goods to transport.

You have not tried to find another destiny for the site?

Of course. Some imagined, for example, retreading activities. It's interesting, but we have already, in Avallon (Yonne) a site specialized in retreading whose capacity corresponds to our needs.

Still, was there really no way to save the La Roche factory?

We tried everything! It was even considered to grow this site, but the deterioration of the market has accelerated and Asian competition has increased. We have been working on it for five years, we have used every possible route. In France, for five years, we invested 1 billion euros in our factories, including more than 70 million in La Roche. But we were in a dead end, there was no other choice.

"Michelin never gives up on anyone"

You signed a competitiveness agreement in 2016 before coming back a year later. Do you understand this feeling of injustice, even treason?

Injustice yes, but no betrayal: we had always said that this agreement held under certain circumstances. And as market conditions changed, the deal could not work anymore. I measure the pain of all those who have invested so much in this project. But Michelin never abandons anyone. We will stay in La Roche as long as it takes. In the past, we have already put in place support clauses of two years or more. If someone goes somewhere else, but it does not suit him, Michelin agrees to look after her to find another job. This is what we will discuss with the social partners.

Why not go there on Thursday to announce your decision?

There will be a lot of emotion today, and that's understandable. The important thing is that everyone can listen to what we have to say. I will come to La Roche later, to listen to the employees and talk to them. It's part of my mission as much as developing Michelin.

Florent Menegaux, President of Michelin. | DANIEL FOURAY / WEST FRANCE

After Dundee, in Scotland (845 employees), you have just announced the closure of Bamberg in Germany (860 employees). Are other sites threatened because of lack of competitiveness? In France, the names of Cholet, Avallon, Cataroux circulated.

We launched a national diagnostic to evaluate the performance of our sites. It was concluded that La Roche-sur-Yon was in a dead end, but this is not the case for others. I can not guarantee the eternal character of a site, but do not make a very difficult decision, a generality.

Research and development, new energies, are promising professions. But the traditional industry seems doomed ...

No. We manufacture high-tech cables in Vannes, very high-end tires, competition, for civil engineering machinery ... everywhere in France. There is a good industrial future for France, provided that it does not have a static vision of employment.

Will the tire's share of your turnover go down?

Today, it's 90% of our business. In ten years, it will probably be two-thirds.

Michelin, what is today?

125,000 employees worldwide (1) , including 20,000 in France, excluding Euromaster (2) . With a balance of jobs fairly stable in France. We invest a lot in new activities. A digital hub has been created in Lyon with more than 150 jobs, opened a 3D printer center near Clermont-Ferrand, created a hydrogen activity with just over 200 jobs in Rhône-Alpes Auvergne. Every year, Michelin recruits 7,500 people around the world and 1,000 in France. But the trades evolve.

(1) Turnover is 22 billion euros. Europe accounts for 39% of sales, North America and Mexico 35%, Asia and the rest of the world: 26%.

(2) In the West, Michelin has two other plants. One in Cholet (Maine-et-Loire), 1,338 people who manufacture rubber compounds, Cross Climate and Agilis tires, as well as light truck, SUV and SUV tires. The other in Vannes (Morbihan), 402 people and specialized in the metal skeletons of heavy goods vehicles tires and tourism.

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