Red Sea crisis forces Michelin to halt output in Spain next weekend
Reuters
Published Jan 16, 2024 13:45
MADRID (Reuters) - Four factories in Spain owned by French tyre maker Michelin (EPA:MICP) are planning to halt output again on the weekend of Jan. 20-21 due to delays in the delivery of raw materials caused by the crisis in the Red Sea, the company's Spanish subsidiary said on Tuesday.
The United States and Britain launched a series of strikes on Yemen last week, aimed at the Iran-backed Houthi militia, whose attacks on international shipping have disrupted one of the world's most important routes since December.
A dozen shipping lines have opted to divert ships that previously used this route via southern Africa, increasing the crossing time for supplies to Europe by about 10 days.
Michelin had already suspended work shifts at its Spanish plants on the weekend of Jan. 13-14 due to longer delivery times of raw materials it needs to produce rubber and that are delivered by sea from Asia, the company told Reuters.
Spanish newspaper Expansion reported earlier on Tuesday that Michelin would halt work for a second weekend and the company later confirmed to Reuters the stoppage would take place on Jan. 20-21.
Michelin's move in Spain is similar to measures taken by other manufacturers such as automakers Tesla and Geely-owned Volvo Car, which last week announced they were suspending some production in Europe due to a shortage of components.
Michelin's Spanish factories are the company's second-largest rubber producers but the unit said it had sufficient stocks of rubber to cope with the ongoing situation while it maintained supplies of raw material by sea, and was not planning to take any additional measures in Spain.
Spanish retail and food industry association, Aecoc, has also said the Red Sea crisis was having "a significant impact" on major companies involved in the manufacturing and distribution of food, textiles and technology products.
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Written By: Reuters
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