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Green Wheels

By Li Fangfang (China Daily)
Updated: 2008-09-22 08:09

It was far beyond Yves Chapot's expectation that after only two years, his company Michelin delivered the 100,000th "green" truck and bus tire to Chinese consumers.

Since it introduced its fuel saving tires to China's commercial vehicle market (the world's biggest) in 2006, the French tire maker has made energy conservation and environmental protection a point of pride for its new products.

"China's 11th Five-Year Plan (2006-10) calls for cutting energy consumption per unit of gross domestic product up to 20 percent by 2010. Michelin is making its own efforts under the Chinese government's guidelines," says Chapot.

Michelin says that with more than 400 million sold since its European launch in 1992, the green tires represent three-fourths of Michelin sales in Europe. By replacing the carbon black in the tire treads with silica, the green tire guarantees a 3 percent saving on fuel consumption, thereby enabling the tire to maintain the same level of grip while reducing heat loss.

"Green tires take up two thirds of our replacement market in China. Most of the tires we offer here are of lower rolling resistance," Chapot adds.

Michelin is the only tire maker providing green wheels for trucks and buses in China.

Industry forecasts say that by 2010 the total tire demand in the Chinese market will be around 300 million units. The demand will inevitably speed up and also hasten the application of environmentally friendly technologies.

"We think the road mobility in China is facing great challenges which result from a shortage of energy, as well as traffic problems. We hope the green tire will contribute to improving the road situation in China," says Chapot.

To publicize its efforts in China, Michelin chose Shanghai to host its 2004 Challenge Bibendum, considered one of the world's most important events promoting the development of clean energy, road safety and fuel economy. Michelin's late CEO Edouard Michelin founded the event in 1998 to celebrate the 100th birthday of the Michelin Man, the company's mascot and advertising logo, known to the French as "Bibendum".

The event returned to China again in 2007.

"The return to China was one way for Michelin and our partners to help the Chinese government chart the way forward for more fuel-efficient, cleaner, safer and less congested roads; an atmosphere that respects both people and the environment," says Chapot.

"In the future, we will continue to contribute to local communities with very strict respect to the environment and concrete commitments to local developments and specific needs," he says.

Michelin has sunk $440 million into the Chinese market since 1996. "The investment in China has proved to be the correct decision for Michelin," says Chapot.

Michelin was the first international tire maker to set up its office in China.

After establishing its sales office in Hong Kong in 1988, Michelin set up its first mainland representative office in Beijing in 1989 to promote its products and prepare the distribution channels in major cities.

"It shows Michelin's confidence in China and the local market. The policy of market opening-up and reform offers a good opportunity to Michelin by providing a favorable business investment environment," says Chapot.

However, in the early times, "how to leverage the cultural differences and combine Michelin's company culture with China's developing environment was the big challenge for Michelin", he says."Michelin needed to build up a strong local management team."

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