CLERMONT-FERRAND, France: The world's largest tyre manufacturer is set to spend mega-euros on a global brand-boosting exercise via the expansion of its already famed maps and guidebooks.
The move is a tacit acknowledgment by Michelin that price competition – particularly from the Far East – is eroding into its world markets.
But the Michelin man is reluctant to put a cost tag on his promotional publishing efforts – and equally unwilling to reveal whether the maps and guides division is a profit or a cost centre.
The tyre-maker's famed red restaurant and hotel guides almost certainly fall into the latter category, as divisional head Christian Delhaye concedes. In all there are 220 different publications in twelve different languages.
Each of the guides' god-like restaurant inspectors costs Michelin around €100,000 a year and, according to Delhaye they "can't be profitable" if they are to maintain their fiercely defended independence.
Nonetheless, he believes it a worthwhile promotional investment to "accompany Michelin in its internationalisation", which includes expanding the number of languages in which the guides are printed from twelve to eighteen.
As to maps, Michelin sold around twenty million in 2007 and is projecting foreign sales to reach about 60% of the maps and guides division's turnover by 2009. It currently stands at around 50%.
Data sourced from Financial Times; additional content by WARC staff