Michelin settles with 17 states over ad claims
For the second time in six months, Michelin North America Inc. has resolved a complaint from Bridgestone Americas Inc. about its consumer tire advertising claims.
Earlier today, the state of Tennessee announced a multistate settlement with Michelin "regarding alleged misrepresentations Michelin made in its advertising of Michelin fuel efficient tires." Alaska, Arizona, Delaware, Iowa, Kentucky, Massachusetts, Montana, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Pennsylvania, Rhode Island, Texas and Vermont also were involved in the settlement.
The state attorneys general alleged that in May or June of 2008, Michelin "promoted questionable savings" associated with its fuel-efficient tires in ads in the Wall Street Journal and USA Today newspapers, as well as radio and television advertisements on ESPN during athletic events. Specifically, the ads contained representations such as the following:
* “It’s time to fight back. Michelin fuel-efficient, long-lasting tires help you save money,” and
* “Michelin makes the most fuel-efficient line of tires on the road, which saves you money over the life of your tires.”
Bridgestone also filed a complaint against Michelin North America with the National Advertising Division of the Council of Better Business Bureaus last December over the same ads. For more information, see "NAD responds to Bridgestone complaints about Michelin ad claims," Dec. 20, on www.moderntiredealer.com.
The states allege that Michelin’s fuel efficiency advertisements did not adequately disclose that the advertised costs savings were based solely on savings in fuel costs, not on the comparative costs of competing tires. In addition, the states’ review of Michelin’s own studies indicates that its tires "are only the most fuel efficient in 78% of its classes of tires."
The states also expressed concern that footnote disclosures regarding the fuel efficiency advertisements were not clear and conspicuous.
As part of the settlement, Michelin, which denies any wrongdoing, agreed to pay $375,000 to the states "simply to cover the cost of the investigations," according to Scott Clark, COO of Michelin Americas Small Tires.
"It is significant when people challenge our claims. We don’t want people to think our claims are inaccurate.”
According to Michelin, the company has received exactly one complaint related to its fuel efficiency advertising. Bridgestone Americas, based in Nashville, lodged the complaint.
“We have been asked to increase the font size on the disclaimer, showing what competitors we are up against," says Clark. While Michelin will make "some very minor modifications to our claims,” including changes in “word-smithing," the company "demonstrated that our tires do make a difference in fuel efficiency, and we will aggressively continue to communicate the fuel efficient qualities of our tires."
According to Tennesse Attorney General Bob Cooper, the tiremaker fully cooperated with the investigation.
"We believe that the messaging in the advertisement, as well as the substantiation behind the product claims, is accurate and factual. We will continue to promote the fuel-efficiency advantages of Michelin tires in future advertising."