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Tyre maker Michelin to shut factories in Germany

FRANKFURT (AFP) – French tyre manufacturer Michelin said on Tuesday it will close two factories and cut more than 1,500 jobs in Germany due to rising costs and competition from cheaper imports.

The vast industrial sector in Europe’s top economy has been battling high energy prices, surging inflation and fast-rising eurozone interest rates for more than a year.

Michelin said in a statement it would end production at its sites in Karlsruhe and Trier by 2025, while the production of some products would cease at a site in Homburg.

A customer service centre in Karlsruhe that serves Germany, Austria and Switzerland will also be closed, with its operations to be transferred to Poland.

A total of 1,532 workers will be affected, the company said.

Michelin attributed the decision to “budget truck tyres from low-wage countries and rising production costs in Germany”.

It also said “recent health and geopolitical crises” had pushed up operating costs, putting “additional strain on Germany’s competitiveness as an industrial location”.

The outbreak of the Ukraine war, and Moscow’s subsequent move to slash gas exports, had a particularly negative impact on German manufacturers, which had come to rely on Russian energy.

But the IGBCE union criticised the job cuts as “wrong”, adding: “Michelin only wants to maximise profit and is abandoning highly committed and highly qualified employees to do so”.

A tyre from French manufacturer Michelin on a sports vehicle. PHOTO: AFP