Michelin to set up new plant in León, Mexico

Mexico is becoming the new hot spot for investment by automakers – both OEMs and component suppliers.

The recent past has seen announcements by BMW, Bosch, Comstar Automotive and Edsha to set up new manufacturing plants in the Latin American country. Earlier this month, Michelin announced plans to build a production facility in the centre of Mexico to manufacture high-end tyres for passenger cars and light trucks.

The first tyres are expected to come off the production line in fourth-quarter 2018. The new plant in León (Guanajuato state) is the Group’s 21st in North America and 69th worldwide. Its location reflects Michelin’s commitment to producing its tires as close as possible to the markets in which they are sold.The construction of the 142,000-square-meter plant, which represents an investment of €450 million ($510 million), is expected to begin in second-half 2016. Once completed, the León plant will be ramped up gradually. During the initial production phase, it is expected to manufacture four to five million tyres a year for Michelin customers with plants in the region as well as for the large north-american domestic market, which has been enjoying strong growth in recent years.

Michelin says it is building this plant to respond both to sharp growth in Mexico's automobile market and to the confidence that the world's largest car manufacturers have put in us. “The largest investment approved by the Group in 2016, the new plant reflects our ability to take advantage of growth opportunities in the dynamic North American market and to make our manufacturing operations more agile by deploying tire ranges that integrate innovative technology,” said Jean-Dominique Senard, CEO of the Michelin Group, which is headquartered in Clermont-Ferrand (France).  

Most of these high-performance tyres will be produced for the original equipment segment. The plant's location was chosen because it is just a three-hour drive from the production facilities of 18 large car manufacturers with operations in Mexico. These short distances mean that the tyres will be delivered to Michelin’s customers faster and more cost effectively, thereby reducing the Group's carbon footprint and helping it to meet its environmental objectives.

“We’re pleased to strengthen our industrial presence in Mexico, thereby being able to satisfy the needs of North American car manufacturers and motorists looking for high-quality tires that are perfectly adapted to their usage conditions,” said Mike Boggs, director of Michelin Mexico.

Michelin has been present in North America since 1950 and currently employs 23,000 people in the US, Canada and Mexico.