Raw material prices continue to climb Michelin tires or increase prices

Jean-Dominique Senard, the next chief executive appointed by French tire manufacturer Michelin, said recently that the company is currently facing unprecedented pressure due to rising raw material prices. Although the company has not stated when the current CEO, Rory, will retire, the company has already appointed Sunard to replace him.

Sunard believes that Michelin’s operating profit in 2011 will continue to increase despite the pressure of rising raw materials. He reiterated the company’s long-term goals set in October last year. Including, as of 2015, the operating profit of the company after removing non-recurring items will reach more than 2 billion euros (about 2.8 billion US dollars).

At a general meeting held in Clermont-Ferrand, a French headquarters in central France, Sunard said: "This year, Michelin will spend an additional 1.8 billion euros on costs due to rising raw material prices."

He said that the company's new products have been put into production, so that the company's raw material supply is not threatened, but the fluctuation of raw material prices is still worth the company's concerns.

It is reported that Michelin has raised the price of its products in April this year and has balanced the rising cost of raw materials. Sources said that in order to keep up with the rising cost of raw material costs, the company will raise prices again in the next 9 months to offset its cost increase of 400 million euros.

In early May, Michelin announced that the company plans to increase the prices of truck tires to cope with rising raw material prices.