This text gives an overview about the product line of Michelin. Michelin was established in 1889. Its main entrepreneurial sector is tire manufacturing, but Michelin is also known for its travel guides and Michelin stars which certify the best restaurants around the world. Michelin has been the number one tire retailer in Europe, this means that the high quality of the product and the high developed technology involved, made the company create profits of around 16 billion euros in 2005. Although not only the European market has a major participation in the company’s incomes, the enterprise itself has 74 industrial sites spreaded in 19 countries and a sale presence in more than 170 countries.
Table of Contents
- I Introduction - Michelin Company
- II Michelin's main product: high quality tires
- Product Description
- III OE Market and RT market
- Position of Michelin in OE and RT markets
- OE Market
- RT MARKET
- Comparison of OE and RT market
- OE or RT market - Which one is more important for Michelin?
- IV Tread wear and Rolling resistance
- V Michelins new product launch: Michelin Energy 4
- Product Launch
- The best option
- VI Conclusion
Objectives and Key Themes
This case study analyzes Michelin's market position and strategies, focusing on the Original Equipment (OE) and Replacement Tire (RT) markets. It examines the differing priorities and expectations of various customer segments (car manufacturers, private individuals, fleet operators) regarding tire performance characteristics such as tread wear and rolling resistance. The study also explores the significance of Michelin's OE market success in driving its overall market leadership.
- Michelin's dual market strategy (OE and RT)
- Differing customer priorities in OE and RT markets
- The importance of tread wear and rolling resistance
- The relationship between OE market success and RT market performance
- Michelin's product strategy and innovation
Chapter Summaries
I Introduction - Michelin Company: This introductory chapter provides background information on Michelin, highlighting its history, diversified business interests (including tire manufacturing and travel guides), and its leading position in the European tire market. The chapter establishes Michelin's substantial size and global presence, setting the stage for the detailed analysis of its tire market strategies that follows.
II Michelin's main product: high quality tires: This section delves into the complexities of tire manufacturing, describing the product's key components and the blend of high technology and manual processes involved. The broad range of tire types required to meet the diverse needs of various vehicles and the inherent contradictions in desired features (wear, grip, comfort, reliability, and energy efficiency) are underscored. The chapter emphasizes the intricacies of the product and the challenges of meeting customer demands across different segments.
III OE Market and RT market: This pivotal chapter differentiates between the Original Equipment (OE) and Replacement Tire (RT) markets. The OE market involves supplying tires to car manufacturers for new vehicles, while the RT market caters to the replacement of worn tires by end-users. The chapter highlights the differing customer profiles, price points, and performance expectations associated with each market. It emphasizes the constraints imposed by car manufacturers in the OE market regarding price, performance, and delivery, contrasting this with the greater freedom in pricing and product specification within the RT market.
IV Tread wear and rolling resistance: This chapter explores the key performance characteristics of tires, namely tread wear and rolling resistance, and their varying importance across the OE and RT markets. Tread wear, while crucial for cost-conscious RT customers, is less critical in the OE market due to shorter usage periods and the prioritization of other features by car manufacturers. Rolling resistance, heavily influencing fuel efficiency and thus increasingly important due to environmental regulations, is more significant in the OE market, whereas it is less of a concern for RT end-users who may not perceive its effect as easily.
Keywords
Michelin, tires, OE market, RT market, tread wear, rolling resistance, fuel efficiency, energy efficiency, customer segmentation, market strategy, product innovation, premium tires.
Michelin Case Study: Frequently Asked Questions
What is the main focus of this case study?
This case study analyzes Michelin's market position and strategies, particularly focusing on its performance in the Original Equipment (OE) and Replacement Tire (RT) markets. It examines the different needs and expectations of various customer groups (car manufacturers, individual consumers, fleet operators) regarding tire performance, such as tread wear and rolling resistance. A key aspect is understanding how Michelin's success in the OE market contributes to its overall market leadership.
What are the key themes explored in the case study?
The key themes include Michelin's dual market strategy (OE and RT), the differing priorities of customers in these two markets, the importance of tread wear and rolling resistance, the relationship between OE market success and RT market performance, and Michelin's product strategy and innovation.
What is the difference between the OE and RT markets?
The OE (Original Equipment) market involves supplying tires directly to car manufacturers for new vehicles. The RT (Replacement Tire) market, on the other hand, focuses on supplying replacement tires to end-users whose tires have worn out. These markets differ significantly in customer profiles, price points, and performance expectations. The OE market is often more constrained by manufacturer specifications, while the RT market offers greater flexibility in pricing and product features.
What is the significance of tread wear and rolling resistance?
Tread wear and rolling resistance are crucial performance characteristics of tires. Tread wear is a major concern for RT customers due to cost implications, but less so for OE customers where tire lifespan is typically shorter. Rolling resistance, directly impacting fuel efficiency, is increasingly important due to environmental regulations and is a higher priority in the OE market compared to the RT market.
How does Michelin's success in the OE market impact its RT market performance?
The case study explores the relationship between Michelin's success in the OE market and its performance in the RT market. A strong OE presence can enhance brand reputation and consumer trust, leading to increased sales in the RT market. The study likely examines how this relationship contributes to Michelin's overall market leadership.
What is the role of Michelin's product strategy and innovation?
The case study analyzes Michelin's product strategy and its commitment to innovation. This likely includes discussions of its approach to R&D, new product launches (such as the Michelin Energy 4), and how these innovations cater to the specific needs and demands of both the OE and RT markets.
What are the chapter summaries provided in the case study?
The case study provides chapter summaries covering an introduction to Michelin, a detailed description of its tire manufacturing process and product complexities, a comparison of the OE and RT markets, an analysis of tread wear and rolling resistance, and a conclusion. Each summary highlights the key takeaways of its respective chapter.
What are the key words associated with this case study?
Key words include Michelin, tires, OE market, RT market, tread wear, rolling resistance, fuel efficiency, energy efficiency, customer segmentation, market strategy, product innovation, and premium tires.
- Quote paper
- Anonym (Author), 2016, Michelin's new product line. An overview, Munich, GRIN Verlag, https://www.grin.com/document/368285
