Four months after Michelin North America announced it planned to close its tire plant in Ardmore, Oklahoma, another tire company has announced similar plans and for the same reason—changes in tire demand as a result of the electric vehicle industry and the cost of meeting those demands.
Michelin issued a statement in November 2023, indicating it made the difficult decision because the southern Oklahoma plant could no longer meet the changing demands of the auto industry. It will close the plant by 2025.
This week, German auto supplier Continental made a similar announcement. It plans to cut more than 7,100 jobs worldwide by 2025 because of the difficult switch to electric vehicles forces companies in the sector to retool. Like Michelin chose not to retool its Oklahoma plant, Continental made the same decision. Continental’s initial job cuts will total 1,750 in research and development. The company has nearly 200,000 workers across the globe.
How is the EV industry affecting tire manufacturing? It has to do with instyant torque, which electric vehicles are able to do while gas-powered vehicles cannot. As a result, it is harder on tires and according to some reports, some EV firms that that EVs wear standard tires at a rate 30% faster than tires on gas-powered cars and trucks.
As a result, there is a demand or increased need for specialized tires which are wider on EVs and it means retooling for tire manufacturers. It’s a cost they don’t want to assume.
Source: AFP