Michelin: Comprehensive Retreading Operations

When Germany’s Euromaster took over Viborg in 2003, Michelin took hold of yet another industrial base in Western Europe. Until then French retreader Pneu Laurent was only present in Germany with a distribution organisation, following the acquisition it also had a retreading plant under its umbrella. At the retreading facility in the city of Oranienburg, north of Berlin, the Laurent group now produces mould-cure retreaded truck tyres in Germany (together with Remix tyres produced in Homburg). The tyres Laurent produces in its facilities in Germany and France are parallel products to Michelin’s new tyre and casing concept, which is generally described under the “4 lives” slogan, as managing director Jérôme Mouillet and Dirk Schierhorn, head of sales at Laurent Reifen GmbH in Germany, point out in an interview with Tyres & Accessories. The Laurent group thus offers Michelin tread patterns featuring Michelin’s renowned quality to the tyre trade – but these retreads don’t exclusively come on Michelin casings. After Michelin took over the retreading facility in Berlin, the factory’s technology, its equipment and machinery, its moulds as well as its environmental and safety standards had to be brought up to a level acceptable to the French tyre giant. Even a complete land reclamation programme took place at the site in order to comply with the high legal as well as corporate standards required by the new owners. The site has been in operation since 2004. The Laurent group’s German facility is one that (mostly) produces mould-cure retreaded truck tyres and benefits Michelin’s quality management system. Nevertheless, it is not a competitor to Michelin’s Remix mould-cure retreads because – unlike Remix – Laurent tyres predominantly produced on non-Michelin casings.

At the same time, these mould-cure retreads are not marketed under the Michelin name but under its own “Pneu Laurent” brand name. At this point it must be mentioned that Laurent does not exclusively use the demanding mould-cure process in its production sites in Berlin or Avallon. Currently four out of five truck tyres retreaded at Laurent in Germany are retreaded according to the mould-cure procedure, most of which are actually bead-to-bead retreads. The remaining 20 per cent are pre-cure retreads. The latter are usually tyres with a tread pattern or a dimension that is in less demand and thus does not justify the high investment necessary for the mould-cure process, Mr Mouillet continues. Furthermore, both production sites in Berlin and Avallon offer an identical product range, with the sole exception that the German plant does not produce OTR retreads. Compounds for the retreading process are all exclusively supplied by Laurent’s parent company Michelin. If there is an excess of pre-cure treads at one of Laurent’s facilities, they are used elsewhere in the group. Although Laurent clearly is a specialist in mould-cure retreading, it is the pre-cure procedure where the company has managed to implement a unique and innovative new technology: the SEPL production procedure. SEPL is an acronym for “Sommet Élargie Pneu Laurent“, which literally means “enlarged shoulder by Pneu Laurent”.

It is this SEPL production procedure that now allows the retreader to use one and the same tread, with its given dimensions, on different casings (those with the same size dimensions listed on the sidewall) originally produced by different new tyre manufacturers. The solution to this technical problem is a computer-controlled extruder that can enlarge the casing’s shoulder by applying additional rubber. It has always been the case that different thresholds of tolerance have been allowed for by the different new tyre manufacturers in the design and construction of their casings, although actual tyre dimensions are the same. These tolerances usually meant that different pre-cured treads varying in width had to be used during the pre-cured retreading process. Thanks to the new SEPL technology developed by Pneu Laurent (for further details also see T&A 9/2007) the mileage of a retreaded truck tyre can be increased by up to 14 per cent compared to a pre-cured retread retreaded using the traditional technology – as Laurent points out, increased does not equal increased prices for end consumers. Furthermore, the SEPL technology has a positive effect on the retread’s properties as well as on safety requirements, the managing director says. Laurent is currently introducing the SEPL technology for all the different dimensions and treads that are still retreaded according to the pre-cured procedure.

This new technology not only solves a long-standing technological and industrial problem, it also reduces the level of complexity within the production process. Decreased complexity of course is something of utmost importance for any retreading company, but in light of the stagnant market situation it is not only production processes that need to be streamlined. It also applies to the company’s distribution model and – even more importantly – for casing logistics. Laurent, for example, benefits from a well-trained delivery staff. These employees are not only considered spearheads in terms of customer relationships; Laurent’s delivery staff also work as casing specialists who control every casing a tyre dealer returns to Laurent to be retreaded; all this happens at the tyre dealer’s premises and helps to reduce the number of truck tyres that fail Laurent’s entry controls and – again – this also helps to decrease the level of complexity. In addition to the nine casing specialists that currently work for Laurent Reifen GmbH in Germany is a team of seven sales representatives covering the market. Both groups will be expanded in the near future, Mr Mouillet says. During the week the Oranienburg facility operates around the clock, on a “24/5” basis. This not only gives an indication of the factory’s use of capacity, it also shows that the facility is operating with an almost seamless flow of production. In particular over the past two years Laurent Reifen has been able to enjoy double-digit annual growth.

Referring to this growth rate, Mr Mouillet points that all this has taken place and is still happening in a stagnant market. “We are gaining market share,” he continues, “but at the same time we are also experiencing a strong competitive pressure which we are answering with more service, product quality and reliability.” With a combined capacity of 500,000 retreaded tyres in Berlin and Avallon, both factories have a combined output of about 350,000 retreads, allowing the Laurent group to generate an annual turnover of about 100 million euros. Detailed figures about the factories as single entities remain undisclosed; just this much is known: the capacity at the Berlin facility is at about 200,000 units per year. With regards to the distribution of its products, Laurent Reifen GmbH (still) has clear boundaries. As the head of sales Dirk Schierhorn points out, the company supplies tyre dealers within a radius of around 800 kilometres, although neighbouring countries to the east of Germany currently do not play a major role for the distribution of the “Pneu Laurent” retreads.

However, these are the markets where the Laurent group sees a reasonable amount of future potential and it is a declared goal that the group will gain a foothold in these European markets. On the other hand, it is said: “Right now, Russia is no subject for us.” The UK is also a market not supplied with tyres produced in Berlin or Avallon. In our market Michelin produces another retreading brand, called “Encore” and widely comparable with the “Pneu Laurent” brand (see article in the March 2008 Retreading Special). Currently, the German subsidiary of the French Michelin corporation sells about 40 per cent of its output on export markets. Most of the tyres retreaded in Berlin thus stay within Germany and are sold through the specialised tyre trade. As the managing director explains, his distribution strategy is not only about tyre dealers that are close to the Michelin group or even owned by them: Any tyre dealer is a potential customer. Laurent Reifen GmbH runs a large warehouse at its Berlin premises. The company currently employs 135 people, 30 of which have been hired within the last 12 months. Pneu Laurent in France employs about 700 workers.