More plant closures: Michelin targets Colombia
Continuing the global realignment of its tire manufacturing, Groupe Michelin has decided to discontinue its consumer and commercial tire manufacturing operations in Colombia.
The decision was made in response to more than a decade of substantial annual losses in the local Icollantas subsidiary, "which repeated investments have failed to stem," says the company. In accordance with Colombian law, a notice of intent has been filed with government authorities.
"Due to its insufficient size and other local economic factors, the unit has never managed to be competitive. Production operations at the Chusaca truck tire plant, which employs around 220 people, and at the Cali plant, which makes Michelin passenger car tires and BFGoodrich tires with a workforce of around 240 people, will be shut down in the summer of 2013."
Michelin is offering personalized socio-economic support to the 460 people it is letting go to help them find new jobs.
Michelin says the sale and distribution of Groupe Michelin brands will be stepped up in Colombia by developing the existing sales force, which will comprise more than 60 people.
Michelin will recognize 101 million euros (approximiately $134 million) in non-recurring expenses in its consolidated financial statements for the six months ending June 30, 2013.
Earlier this week, Michelin announced major plant investments -- and plant closures -- in its European and African operations. For more information, check out "Michelin to invest $1 billion in French plants, close two truck tire factories."