Michelin targets more than 20% of sales from non-tyre businesses by 2030
Michelin is on track to generate 20% of its revenue outside the tyre business by 2030, an executive said on Friday, as the company diversifies away from a core business pummelled by major shifts in the global car industry.
The French firm is one of the world's top tyre producers but is facing severe competition from Chinese rivals with lower production costs, and a shrinking client base in Europe.
It generates about 15% to 16% of revenues from non-core activities including services and composite materials and is aiming to grow this through organic growth and acquisitions, Maude Portigliatti, director of the group's Business Polymer Composite Solutions unit, said in a press briefing.
As part of the growth, Portigliatti also announced a €60m (R1,219,731,600) investment in a factory near Lyon to produce 5-HMF, a biobased molecule that can replace the use of fossil fuel-derived formaldehyde in resins and glues and other wide-ranging uses.
The plant, with an annual capacity of 3,000 tons, will start in 2026 and is expected to become the largest production site for 5-HMF in the world.
Analysts at Jefferies upgraded Michelin on Friday to a "buy" rating, pointing to its better earnings growth relative to peers and lower exposure to autos, which they said carry risks in 2025.
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