Preview

Michelin Offshoring in China

Better Essays
Open Document
Open Document
1127 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Michelin Offshoring in China
MICHELIN
OFFSHORING IN CHINA

1.
About Michelin

Michelin is a tire company that was created by Edouard and André Michelin in 1888 in Clermond-Ferrand, France. The company created the removable tire; the train tire and the green tire that reduce fuel consumption. Today the company has become the biggest tire manufacturer in the world with 20% market shares and an annual revenue of€17.89 in 2010. There headquarter are still based in Clermont-Ferrand but the company has become international. Its main factories are based in Europe and in the United States and its products are sold all around the world. The problem is that it’s becoming more and more difficult for the company to keep its place of leader on this constantly growing market.

The Michelin Company is starting to close factories and lay off employees in France because the factories are not enough competitive. Its production activity has always been principally based in France but today with the evolution of the market it is very difficult for the company to continue like that and stay competitive. A lot of new producers are appearing on the tire market and are basing their production in countries like China or India where labor and production costs are a lot lower than in France. If Michelin wants to stay competitive and keep its position of leader in the tire market it is imperative that it starts exporting its production activity in one of those countries.

It’s been decided that the company should build a factory in China. There are many reasons that influenced our decision to do it in this country. First China has very good infrastructures and a cheap labor. Building a factory in China is also way cheaper and faster than in European countries because there are fewer regulations to take into account. Another good reason for building it in China is because it is the new big market that we have to occupy with many of the other developing Asian countries. China is developing very fast and is

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Eurochem Case

    • 798 Words
    • 3 Pages

    China subsidiary has lower growth than its competitors, then Paus is expatriated to implement the system of the company in China.…

    • 798 Words
    • 3 Pages
    Satisfactory Essays
  • Better Essays

    * Company outsourced certain production keep pricing low and production fast, primarily to factories in China.…

    • 1883 Words
    • 7 Pages
    Better Essays
  • Better Essays

    Goodyear Tire Swot

    • 1286 Words
    • 6 Pages

    Goodyear has evolved as a leader in tire manufacturing and retreading across the globe. The company is the third largest tire company in the world with revenue surpassing twenty billion dollars. Goodyear is the best-selling tire in North America. Goodyear has very strong growth potential in all markets. This is a positive strength because competition is fierce and there is no room for error in the tire business due to the low profit margins on tires. Goodyear remains very profitable despite competition and that has Goodyear in a strong position for future plans and innovations.…

    • 1286 Words
    • 6 Pages
    Better Essays
  • Powerful Essays

    Lima Tire Plant

    • 1447 Words
    • 6 Pages

    The Treadway tire company is a manufacturing company that deals with production of tires. The company has eight manufacturing plants and one of them is the Lima tire plant in Ohio. . The plant went through modernization in 2000 and after the shutdown of another plant the volume shifted to Lima and now the plant is operating 24hours, and is considered to be one of the most productive plants of Treadway. In Lima plant they have 1120 employees of which 970 are hourly employed and all of them work in two shifts each lasting for 12yours.…

    • 1447 Words
    • 6 Pages
    Powerful Essays
  • Better Essays

    The night before China’s entry into the World Trade Organization in December 2001, Motorola Inc. held its global board meeting in Beijing for the second time and announced an ambitious plan to increase investment, revenue and sourcing by $10 billion each in China over the next five years. Other companies have had similarly grand visions. Telefon AB L.M. Ericsson announced that it would more than double its investment in China to $5.1 billion, also over a five-year period. General Motors Corp.’s plans call for Chinese operations to generate more than $3 billion of revenue by 2008. By that same year, Bayer AG intends to have the second phase of its $3.1 billion production facility up and running…

    • 4882 Words
    • 20 Pages
    Better Essays
  • Powerful Essays

    Michelin Analysis

    • 5607 Words
    • 23 Pages

    Originally based in Clermont Ferrand, the company is now located in more than 170 countries and owns 84 production site all around the world. Even if their core business is the production of tires they diversified their activities in 1900 with the first Michelin map & guides and extend their knowledge for special sector with new type of tires such as plane tire for instance.…

    • 5607 Words
    • 23 Pages
    Powerful Essays
  • Satisfactory Essays

    goodyear case

    • 699 Words
    • 3 Pages

    Goodyear Tire and Rubber Company is a profitable business which was founded in 1898. When 38 year old Frank Seiberling purchased the company he knew nothing on the longevity and success it would bring. Mr. Seiberling installed a down payment on the first Goodyear plant with a borrowed amount of $3500.During the late 1800s and early 1900s cotton and rubber were considered the lifeblood of the industry. At the time of Goodyear’s founding the existence of bicycles was fresh and business was booming at an increasing rate. With faith and the determination of 13 employees Goodyear’s initial production line consisted of bicycle and carriage tires, horseshoe pads and poker chips. With now a new need for bicycle tires being a demand for consumers Goodyear carved its mark in history as the world’s largest tire company in 1916.…

    • 699 Words
    • 3 Pages
    Satisfactory Essays
  • Powerful Essays

    Michelin

    • 1377 Words
    • 6 Pages

    Michelin (/ˈmɪʃəlɪn/ or /ˈmɪtʃəlɪn/; French pronunciation: [miʃ'lɛ̃]; full name: SCA Compagnie Générale des Établissements Michelin) is a tyre manufacturer based in Clermont-Ferrand in the Auvergne région of France. It is one of the two largest tyre manufacturers in the world along with Bridgestone.[2] In addition to the Michelin brand, it also owns the BFGoodrich, Kleber, Tigar, Riken, Kormoran and Uniroyal (in North America) tyre brands. Michelin is also notable for its Red and Green travel guides, its roadmaps, the Michelin stars that the Red Guide awards to restaurants for their cooking, and for its company mascot Bibendum, colloquially known as the Michelin Man.…

    • 1377 Words
    • 6 Pages
    Powerful Essays
  • Satisfactory Essays

    This is a professional and depth research report on China Tire Building Machine industry. The report firstly introduced Tire Building Machine basic information included Tire Building Machine definition classification application industry chain structure industry overview; international market analysis, China domestic market analysis, Macroeconomic environment and economic situation analysis and influence, Tire Building Machine industry policy and plan, Tire Building Machine product specification, manufacturing process, product cost structure etc. then statistics China key manufacturers Tire Building Machine capacity production cost price profit production value gross margin etc details information, at the same time, statistics these manufacturers Tire Building Machine products customers application capacity market position company contact information etc company related information, then collect all these manufacturers data and listed China Tire Building Machine capacity production capacity market share production market share supply demand shortage import export consumption etc data statistics, and then introduced China Tire Building Machine 2009-2017 capacity production price cost profit production value gross margin etc information.…

    • 584 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Tires are an assembly of different components such as tread, bead, sidewall, shoulder, and ply. The demand for tires is increasing significantly in developing economies such as Brazil because of improvements in the economy and an increase in people's purchasing power. There are different types of tires that are available in the market based on their applications, such as all-season tires, winter tires, specialty tires, and agriculture tires.…

    • 356 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    My Case Camar

    • 562 Words
    • 3 Pages

    Camar Automotive Hoist has built its reputation on a quality product in the Canadian market however in 2000 the company is facing the problem of sustaining future growth of its business. In an attempt to address this need of sustaining growth we recommend that Camar Automotive Hoist clearly defines its position as a safe and convenient scissor lift producer on international wheel alignment markets; and transfers its focus mainly on the US and the European Union markets. Our suggestion is to spotlight the US market by working closely with the wholesalers instead of using a direct sales-force; while exporting products to Europe by means of indirect exportation instead of through other ventures. By doing this, the company will efficiently allocate its resources and achieve its goal of sustaining growth gradually with low risks. The Canadian market potential is limited thus we believe that US market is a quick growth opportunity for us immediately with low risks while exploring the EU now will allow us to search for long term future growth.…

    • 562 Words
    • 3 Pages
    Satisfactory Essays
  • Best Essays

    Im Final

    • 3221 Words
    • 13 Pages

    Michelin, headquartered in France , is operating in over 170 countries worldwide, mainly engaged in manufacturing of tyres. With a market share of 20 per cent for tyres in the world market, it rules the European market with 32 per cent of the market share (Bridgestone, 2010).…

    • 3221 Words
    • 13 Pages
    Best Essays
  • Satisfactory Essays

    My Presentation

    • 457 Words
    • 2 Pages

    The tires exported are mainly middle or low-class products targeted at foreign spare tire market. The technology content and brand value of the products are relatively low in comparison to foreign products. In addition, because of the low prices and giant volume of exports, the export of tires can be easily judged as dumping and result in conflicts. According to this, tire companies should pay more attention to R&D programs in search of competitive products that are high value-added.…

    • 457 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    In this case, there are two major problems that I can analyzed. Firstly, Kiki and Houida which are two of major loyal customers of Couture Fashions Bhd (HCF)’s were writing to Jeffrey to inform him that they may looking to China to “contract manufacture” for them as the prices there were very competitive. Second, the previous adverse perception of “Made in China” labels had slowly changed as China now manufactured clothes that are higher quality at substantially lower operating costs.…

    • 1002 Words
    • 5 Pages
    Good Essays
  • Satisfactory Essays

    The economy of was emerging and the total production of vehicles more than doubled between 1994 and 2004 so it had a good potential for the industry. Basically in 1926, the first tire was made by a British company Dunlop, and followers of Dunlop were other three foreign companies: The Americans Firestone, Good Year and Italian Ceat, but latter on Indian…

    • 666 Words
    • 3 Pages
    Satisfactory Essays