Michelin Worries About Raw Material Prices

During last week’s Geneva Motor show Michelin is reported to have said that the situation surrounding raw materials is “very worrying” and rising prices will continue to place severe pressure on the company during 2005.

“This year, the environment for raw materials remains tense, which is causing strong pressure on prices, and as a consequence on our costs,” said research and development director Didier Miraton in Geneva.
“There is no situation of us having a shortage but the tension is very worrying,” he added.

Michelin has decided to raise prices by an average of five per cent in Europe until July 2005 to offset increased raw material costs. Miraton said he expected the situation to continue as mobility needs in Asia would drive demand, stressing that there was “a need to find ways to make better use of raw materials”.