French tyre maker Michelin announced today a plan to cut 1,093 jobs on a voluntary basis as part of a restructuring of its facilities as it battles with falling demand from carmakers.
Michelin added it would also invest more than €100 million at its Clermont-Ferrand research and development centre and hire around 500 people a year over the next three years.
Michelin's rival Continental, which is also struggling with a sharp drop in orders from the car industry, has already announced the closure of plants in France and Germany, resulting in the layoff of hundreds of workers.
Earlier this year, US rival Goodyear also said it planned to cut 5,000 jobs worldwide this year.
The company's 2008 annual report said the Michelin group had 117,565 employees.
Michelin said today that it remained committed to maintaining core businesses in France and added it would carry out its restructuring without any layoffs.
In April, Michelin reported a 14 per cent fall in first quarter sales but said it was on track to meet its full-year goal of achieving positive free cash flow.
Michelin shares were down 2.9 per cent at €41.71 in mid-morning trade, underperforming a 0.8 per cent fall in France's benchmark CAC-40 index and a 1.2 per cent decline in the DJ Stoxx European automotive sector.
Since the start of 2009, Michelin shares have risen around 11 per cent compared with an 8 per cent gain in the European car sector. The shares fell 52 per cent last year.
Reuters