Supply hurdles bring Michelin's Russian operations to a halt
Reuters
Published Mar 15, 2022 17:26
(Reuters) -French tyre maker Michelin (PA:MICP) is suspending its industrial activity in Russia and exports to the country due to supply difficulties following Moscow's invasion of Ukraine.
In 2004, Michelin became the first international tyre company to open its own production in Russia, with sales in the country currently representing 2% of the group's total and 1% of its global passenger car tyre production, Michelin said in a statement.
The group's only plant in Russia, Davydovo, repairs truck tyres and produces up to 2 million new car tyres per year, mainly for the Russian market and some Northern European countries.
"The plant was already working at a very low level since several days. There is a lot of supply difficulties - which means we have disruption of financial flows, and there's a problem of currency instability," the company's spokesperson told Reuters.
Michelin was looking for alternative supply sources in Asia and the Middle East, the spokesperson said, adding the group would continue to pay the wages of the more than 1,000 people it employs in Russia, including 750 at the Davydovo plant.
It had stopped sales of plane tyres and mining tyres following U.S. sanctions, before halting exports completely on Tuesday.
Get The App
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.