Michelin Rolling Out Further UK Cost Cutting Measures

The light has yet to appear at the end of the economic downturn tunnel, and in response to market conditions Michelin in the UK is taking steps to cut costs. Measures being introduced include a pause in production of its Encore brand truck tyres between April 11 and 20, and a delay in the annual salary increases of about 600 salaried employees. Increases due in May will not take place until September.

Furthermore, all employees with temporary contracts – around 50 in total – will work 15 less shifts between February 15 and June 6. This equals about one day per week less for each of these workers. Around 350 factory employees have already been paid to take time off work; Michelin now says workers will not have to work extra hours to make up for the paid leave until at least the end of 2011, an indication that the company fears demand for its products will be slow in returning.

According to the works convenor for the Unite union at Michelin’s Stoke facility, Robert Taylor, redundancies are not out of the question. “Today’s announcement has not helped with the feeling of uncertainty we have regarding all our futures and the future of the Stoke site,” he commented. “There may be a need to have further lay-offs across the site but the need for this can only be decided when more information becomes available.

“As for redundancies, they are the last choice to be made and it is anticipated that if – and I must emphasise if – there is a need to make any, it would be minimal and done on a voluntary basis,” he added. “Every suggestion must be thoroughly explored before a final decision is made. My number one aim, and to be fair, the number one aim of the senior management team, is to secure as many jobs on the site as possible, not just for the next few months but for years to come.”