01 Alexis Garcin, Executive Vice President, Aircraft, Beyond Road, Mining Business Lines, Member of the Group Executive Committee Group sales in the Specialties segment declined in 2024. How do you analyze the current business environment? Specialty markets, which primarily concern products and services for farm machinery, mining, construction and materials handling equipment and aircraft, are complex and demanding. Our 2024 performance was shaped by sharp drop in farm commodity markets and a sluggish economy, which particularly impacted the construction industry. In mining tires, our sales were dampened by customer inventory drawdowns to bring levels back to normal after the stockpiling in prior years to avoid the risk of shortages while post-Covid demand was so high. Business was also disrupted by the more restricted access to certain markets. In the aircraft tire segment, which we know very well since more than half the world’s aircraft are equipped with Michelin radials, growth was robust over the year. In this market environment, what is the Michelin Group’s strategy? Our strategy is grounded in two core strengths: innovation and customer centricity. We’re taking a selective approach, targeting customers and market segments able to leverage the full value of our technological leadership. Given the highly demanding uses and requirements our Specialty tires have to meet, our distinctive capabilities are a major advantage in building our value proposition. Technology remains the best barrier to entry by our competitors. In 2024, Michelin introduced the first energyefficient mining tire, the XDR4 SPEED ENERGY, whose new rubber compound enables it to reduce costs on a fleet of 50 machines by around $1.2 million, compared with the market standard, and avoid the emission of 2,600 tonnes of CO2 a year. In the aircraft segment, Michelin plans to launch the Air X SKY LIGHT tire, which is 10% to 20% lighter than previous generations, while delivering improved long-lasting performance without compromising safety. Its service life will represent 15% to 20% more landings than its previous generation equivalent. For a fleet of 40 long-haul aircraft, that adds up to $900 thousand in fuel savings and 3,400 tonnes of avoided CO2 emissions every year. We’re also innovating in the agricultural segment, both with tires for high-powered tractors and in agricultural tracks, a fast-growing market that we lead. In addition to outstanding product performance, we offer customers a unique Services & Solutions approach with, for example, the connected mining tire and our Solideal-On-Site network, which provides high-quality forklift maintenance services in Europe and the United States. How do you see the future of the Specialty businesses, which make a significant contribution to consolidated operating margin? While impacted by the economic or geopolitical environment, these businesses are also structurally growing. The world needs to mine more minerals, feed more people and animals, and bring people closer together through travel. We’re stepping up our investment in these businesses, with a scheduled 6% in their R&D budget in 2025. In this way, we can offer customers products and services that are increasingly aligned with their demanding standards of use, with a focus on higher value-added markets. We’re extremely confident in the future, because we’ve positioned ourselves in the right markets, in the right geographies, with unrivaled product ranges and expertise. Innovation and customer centricity to meet the needs of complex, highly demanding Specialty tire markets SPECIALTIES The tire business Turning challenges into success 38 2024 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN
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