Michelin challenge

[Admin]

Michelin challenge
Tyre executive points out that Southeast Asia has been slow in adapting to the radicalisation of the tyre market
Published: 8/10/2010 at 12:00 AM
Bangkok Post: Newspaper section: Motoring

Months after a chance meeting at the Challenge Bibendum in Brazil where he regaled the Thai media with fine wine and wits and promised me an interview, I crossed paths again with Fre'de'ric Vincent, this time at the headquarters of Michelin Siam at Sanam Pao, Bangkok.



The Frenchman is managing director in charge of Southeast Asia and Oceania, and I put to him the most rhetorical question a scribe could ask a tyre executive: what are the sales figures of Michelin and what is its market share?

"We are in a fast-growing market. Speaking of Southeast Asia, Thailand is our most important market followed by Malaysia and it accounts for half of our sales."

The annual market in the region is in the tune of 50 million tyres of which passenger cars account for 40 million, the rest being OEM commercial truck tyres.

Michelin has been in Thailand 20 years making tyres, quite a successful run so far, but it is the markets of Malaysia, Indonesia and Vietnam that pose a challenge.

The challenge, per se, is that as a whole the region has been slow to adapt to what Vincent termed as radicalisation of the tyre market.

"Indonesia has a small passenger car market but it is one of the most important truck markets. The problem is that its tyre market uses dated cross-ply instead of radial tyre technology. There, tyres with radial technology account for only 5%. But the typical curve of radial tyre technology will climb as original equipment manufacturers (OEM) and infrastructure develop," says Vincent.

Michelin admits that Thailand's tyre market is an even split between radial and cross-ply, the latter being prone to tyre explosions and slower performance.

"Michelin's position in Thailand is very strong given its long presence here. Our market share is best in Thailand."

Michelin's network has also grown alongside its counterparts who have resorted to distribution channels such as Goodyear Eagle stores and Bridgestone's ACT outlets.

"We have developed two channels significantly. Tyre Plus, a multi-brand passenger car tyre channel and Michelin Truck Service Center," explains Vincent of the 150 centres called point of sales or POS.

"Michelin has set up 150 POS. If you add in the small tyre dealerships [yi-pua and sa-pua] then maybe you can double the number of dealers."

Vincent stresses that Michelin's focus is on the quality of service that goes in a tyre, its technological products, proper mounting, proper inflation, alignment and professional service - all of which combine to guarantee consumers optimum advantage when using Michelin tyres.

Given the countless new tyre launches and tyre tests these days, one wonders when and where is it going to end? Is there a plateau? How many more new tyre patterns can tyre makers come up with or is this an example of marketing at its best?

"The essence of tyre R&D comes from the concept of sustainable mobility. By 2030 the vehicle population will double to 1.5 billion vehicles. There are 3,500 deaths everyday caused by road accidents. CO2 emissions must decrease and safety levels must improve.

"Michelin has become part of this fantastic challenge, while the boom in vehicle population continues. Transportation is responsible for one-fourth of the total CO2 output or about five billion tonnes every year. We need to change the design of the automobile. The key question is how tyres can become a part of this change," he says.

The symbiotic relationship between tyre and automobile that Vincent was referring to as change was that the tyre contributed to one-fifth of fuel consumption in a passenger car, and one-third in a truck tyre.

In addition to rolling resistance (RR), noise levels and safety, Vincent noted that the key challenge for makers is to improve the tyre in all the aforementioned aspects.

"No, there is no plateau for tyre innovation. Marketing is always important, to understand the needs of the consumer and capture the market, convey the message to the customer and for us [Michelin] to design the right tyre," explains Vincent.

Vincent then shifted gears to the annual Challenge Bibendum which highlights the plight of the global environment and what tyre makers, automakers and citizens of the world can do to help our planet.

"Challenge Bibendum is a very interesting event. Michelin is the only tyre maker to host such an event, first held 10 years ago, in different parts of the world.

"What this event does is bring several partners to agree around the idea of sustainable mobility. It has become a success. It enables us to have tight links with other key players such as oil producers and automakers.

"Michelin is proud to be an organiser. It's a good way to explain sustainable mobility, but we aren't alone and can't do it alone. The next Challenge Bibendum is in Berlin, Germany."

It's a difficult concept to grasp for the average Joe if a tyre maker says our planet will continue to suffer unless we drive greener vehicles. Obviously, we can't just stop driving tomorrow or idle the transportation industry and its daily appetite of 85 million barrels of oil.

But at least there's a tyre maker, Michelin, and the Challenge Bibendum to make us aware of what our future will be like unless we change for the better.

http://bangkokpost.com/auto/autoscoop/200312/michelin-challenge