05 Financial performance Report of the Managers New scope of reporting Former scope of reporting (in € millions) 2024 2024 Second-half 2024 Fourthquarter 2024 Thirdquarter 2024 First-half 2024 Secondquarter 2024 Firstquarter 2024 GROUP 27,193 27,193 13,712 7,022 6,690 13,481 6,839 6,642 Automotive, Two-wheel and related distribution 14,667 14,084 7,237 3,728 3,509 6,847 3,471 3,376 Road transportation and related distribution 6,599 6,663 3,400 1,730 1,670 3,263 1,668 1,595 Specialty businesses and related distribution 5,927 6,446 3,075 1,564 1,511 3,371 1,700 1,671 Change, year-onyear -4.1% -4.1% -3.9% -2.4% -5.4% -4.2% -3.9% -4.6% Automotive, Two-wheel and related distribution1 -1.3% -1.8% -1.1% +0.0% -2.2% -2.5% -2.7% -2.3% Road transportation and related distribution -4.9% -4.5% -5.0% -4.0% -6.0% -3.9% -1.9% -6.0% Specialty businesses and related distribution -9.4% -8.3% -8.8% -5.8% -11.6% -7.9% -8.1% -7.6% 5.1.2 b) Automotive, Two-wheel and related distribution – Analysis of sales Sales in the Automotive, Two-wheel and related distribution segment fell by 1.3% year-on-year to €14,667 million in 2024. Volumes sold contracted by 1.6% over the year, reflecting a steeper decline in the Original Equipment segment than in Replacement, due to both external factors (particularly a downturn in the automotive market) and the Group’s internal management of the balance between Original Equipment and Replacement sales. Automotive: The decline in Original Equipment sales primarily stemmed from the slowdown in automaker output in a global market down 2% year-on-year, with particularly softer demand in Europe and North America. Sales were also dampened by two market phenomena. First, sales growth temporarily slowed in the electric vehicle segment, where the Group is assertively over-exposed due to its technological leadership. Second, automotive demand shifted to less premium vehicles, which are less favorable for the Group, after a post-Covid period of shortages as automakers pushed their higher value-added models. Lastly, the Group’s share of business with certain OEMs may have declined as a result of its commitment to ensuring that its technological expertise is fairly valued. In the Replacement segment, volumes sold edged back slightly year-on-year, mainly as a result of the Group’s focus on enhancing its positioning in the most value-accretive segments. This explains why sales primarily declined in the most commodified segments, such as small tires and Tier 2 and Tier 3 brands. The percentage of 18-inch and larger tires in the sales mix continued to rise sharply, led by a fast growing market in which the Group maintained its positions. The Group also enjoyed robust sales in the winter tire segment, backed by the September launch of the new MICHELIN Alpin 7 benchmark range. The Group is continuing to deploy its distribution strategy, both by developing its franchising model in brick & mortar dealerships and by broadening its presence in online retailing channels, led by Allopneus, Blackcircles and Tyroola, whose solid operating efficiency delivered significant sales gains in 2024. Sales in Europe ended the year slightly lower, with a sharp disparity between the steep drop in Original Equipment sales and an increase in the Replacement segment. Growth was especially vibrant in Southern Europe (France, Spain, Italy) at year-end, driven by the winter and all-season segments. More generally, 18inch and larger tires remained in high demand. Lastly, in the lower-value segments, KLEBER and our other Tier 2 brands leveraged their excellent positioning to sustain their growth momentum. 327 2024 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN
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