After suspending its manufacturing activities in Russia on March 15, Michelin now confirms that it is technically impossible to resume production, due in particular to supply issues, amid a context of general uncertainty.
The Group is therefore compelled to plan the transfer of all of its Russian operations by the end of 2022 and is considering the possibility of transferring control of its administrative, sales and industrial operations to the current local management. In doing so, Michelin is preparing the most favorable framework possible for its employees.
The new entity would operate through an independent structure from Michelin.
Michelin Russia employs approximately 1,000 people, including 750 at the Davydovo plant, located about 100 kilometres from Moscow. The site has an annual production capacity of 1.5 to 2 million tyres, mainly for passenger cars. Michelin’s sales in the country represent 2% of the Group’s total sales and 1% of its global car tyre production.
In financial terms, the Group’s balance sheet exposure to the project’s perimeter is currently estimated at around €250 million. Completion of this project would lead to the removal of these activities from the scope of Group consolidation but would not impact the Group’s financial Guidance.