Michelin Q1 Net Sales Are Up Less Than 1%
Despite a 4% increase in net sales of passenger car and light truck tires, Michelin Group’s net sales were up less than 1% in the first quarter of 2016 versus the year-ago period.
Michelin Group posted net sales of 5.1 billion euros for the first quarter ended March 31, 2016. That is a 0.9% increase compared to 2015’s first quarter.
Based on the exchange rate on March 31, 2016, Michelin recorded net sales of $5.7 billion in its first quarter.
The company did not release earnings.
The increase in passenger car and light truck tire sales were offset by a 3% decrease in sales of truck tires. In the company’s specialty business segment, which includes earthmover, farm, two-wheel and aircraft tires, net sales were down 4% in the first quarter.
Michelin said its volumes were up 3.7%, outpacing the market in all business segments. Volumes increased 4% for passenger car and light truck tires and 3% for truck tires. Volumes for its specialty businesses were unchanged from the year-ago quarter..
The company said demand was “robust” in the passenger car and light truck and tuck segments in mature markets.
Demand was “mixed” in new markets, with strong passenger car and light truck tire demand in China, buoyant sales in India, and a marked decline in South America.
Specialty tire markets are still affected by ending inventory drawdowns at mining companies, according to Michelin.
The company said its worldwide passenger car and light truck original and equipment replacement market grew by 3% in the first quarter of 2016. Volumes rose by 4% in the first quarter of 2016 thanks to the 4% gain by the Michelin brand (including an 11% rise for 17-inch and larger tires in a segment up 10%), and a 6% improvement by the other brands. Overall, Michelin Group said it strengthened its positions in OE markets, in the value line segments, and, in all emerging regions. In North America, OE unit sales were up 4% and replacement unit sales were up 6%.
The global new truck tire OE and replacement market dipped 2% in unit sales in the first quarter of 2016. Michelin said the retread market was also down, particularly in Europe. In North America, unit sales of OE truck tires were down 12% and replacement unit sales were up 4%.
For more information on Michelin's first quarter results, visit the investor section of the company's website.