Michelin to Halve Tyre Development Time

The fact that Michelin invests around 600 million euros a year in research and development, coupled with good financial and strategic planning will enable the company to ride out the storm that looks likely to buffet the tyre business in 2009. That was Michelin managing partner and worldwide Research & Technology head, Didier Miraton’s message to journalists at a recent innovation day at the company’s Ladoux technology centre. Miraton affirmed that the company is passionate about beating the increasing legislative and technological challenges facing all tyre manufacturers with some ambitious targets: “By the time the [global] number of vehicles doubles, we will have halved fuel consumption [relating to tyres].” Neither will the tyres fitted to the giant vehicle parc of the future weigh one gram more, nor produce one decibel more noise, Miraton said, adding that the company will also continue to reduce braking distances.

However, perhaps the boldest claim, and one Tyres & Accessories had not heard before, was that Michelin will essential halve the time it takes to design, develop and produce a new tyre. According to Didier Miraton, this is not about simply introducing new products, but rather preparing and developing the solutions to future challenges in advance – it is about being: “Open minded about what is useful for customers and society.” Goals like these make for great speeches, but they make even more of an impact when they are backed up by practical examples – which is why Michelin spent the rest of the day demonstrating how it has already begun to put these principles into practice in the passenger car, commercial vehicle, agricultural and OTR segments. For Michelin, the development of its 59/80R63 XDR giant earthmover radial was case in point. In this instance, before vehicle manufacturers like CAT had even built a machine to run on 63-inch tyres, Michelin had built a factory (the company’s Lexington, US plant) based on these enormous dimensions.

While the innovation day started and finished with a particularly visual demonstration of how Michelin tyres influence passenger car fuel efficiency, the importance of earthmover tyre technology was also very close to the fore. The 59/80R63 tyre represents a milestone in tyre development. When fitted to a Caterpillar 797B, one of the world’s largest trucks, the 59/80R63 XDR enables the vehicle to carry 360 tonnes for a gross vehicle weight of over 600 tonnes. And what’s more in addition to acting as a kind of suspension of EM vehicles that rarely include such technology, the tyres manage to last 25 per cent longer than competitors, according to Michelin. The giant XDR tyre contains 890 kilograms of steel and 3.89 tonnes of rubber, enough to produce over 600 car tyres.

Judging by the company’s recent third-quarter results, there are good financial reasons for Michelin’s decision to put its OTR flagship tyre into the public eye. In addition to being an example of technological leadership, sales of OTR tyres (including the 63-inch products which sell for around $60,000 each) have been supporting Michelin’s profitability. In its recent third-quarter results, Michelin reported sales of 4.212 billion euros for the quarter, 1.6 per cent above Morgan Stanley’s expectations. Upon closer inspection, the analysts point out that earthmover tyre sales account for 39 per cent of Michelin’s truck tyre revenues and 32 per cent of specialty division revenues. Without this part of the business functioning as well as it currently does, financial results could be quite different – the bad news is that, according to Morgan Stanley, the third quarter is the last quarter where earthmover sales will remain strong.

Turbulent times

Michelin’s portfolio is much wider than this particularly successful segment alone. Earthmover tyre sales may represent 39 per cent of Michelin’s truck segment revenues, but no-one is predicting a sudden end to the strong demand for earthmover tyres as the moment. Nevertheless this still leaves another 60 per cent of profitable truck and commercial vehicle tyre business. Tyres & Accessories asked Didier Miraton how he thought the pessimistic predictions of a 20 per cent fall in 2009 truck registrations would affect Michelin. Recognising that these are “turbulent times” Miraton pointed out that Michelin is not over-reliant on truck OE business: “More than 60 per cent of [segment] sales are in replacement business. We are well placed to absorb these difficulties.”

To this end the innovation day highlighted the strong fuel saving properties of Michelin’s latest energy saving truck tyre. The Michelin X Energy SaverGreen helps reduce fuel consumption by 0.4 litres per 100 kilometres. At a time when fuel is a long-distance trucking company’s second largest expense (accounting for 27 per cent of total costs versus 16 per cent in 1999), the X Energy SaverGreen offers an opportunity for significant cost savings. According to Michelin it can save a trucker more than 500 litres of diesel a year, or nearly 1,000 litres over the tyre’s initial life. 60 per cent of the tyres fuel savings are said to result from its Energy Flex casing, which means benefits will be passed onto retreaded tyres as well. In two years time this tyre will be remade using Re-Mix technology. In the meantime the new tyre will be distributed across Europe from the beginning of 2009. It is already available in the Spanish, Portguese, Italian and German markets.

“There is no antagonism between fuel economy and braking distances”

The most graphic demonstration of the day came when Michelin illustrated the fuel efficiency of passenger car tyres. To make their point as clearly as possible, technicians took two identical Mercedes kitted out with Michelin tyres and the closest competitor and effectively replaced the fuel tanks with two external test tube-style equivalents. The idea being that after a few hours of driving at 80km/h there would be a visible difference in fuel consumption. And of course there was (see picture). While this demonstration may not be as scientific as some, it was independently adjudicated on the day and highlighted the French manufacturer’s emphasis on this technology.

Some of Michelin’s competitors have asserted that focusing so strongly on fuel economy can only come at the cost of braking distance. Didier Miraton was equally assertive in his response: “There is no, there is no antagonism between fuel economy and braking distances.” Giving a brief explanation as to why this is, Miraton told T&A that the two factors are basically different categories of optimisation that do not have to conflict with each other. Michelin technicians, he explained, can adjust the heat build-up characteristics of a tyre without affecting its rolling resistance. With this in mind, Michelin is hoping to convince an increasing number of original equipment manufacturers of the benefits of its fuel saving, carbon dioxide emission reducing tyres.