Michelin, the tire manufacturer, has announced it will close its Queretaro factory in Mexico by 2025, impacting 480 employees. The facility, which currently manufactures smaller-sized BFGoodrich tires, has become outdated amid a global shift in demand toward larger, more profitable tire models.
According to data from Citi, the Queretaro plant produces fewer than 500,000 tires annually. Following the closure, Michelin will retain only one manufacturing site in Mexico, a modern plant in León, inaugurated in 2016. This decision aligns with the company’s broader strategy to optimize its product mix by focusing on high-value offerings.
The Queretaro shutdown is part of a wider global restructuring effort. Between 2024 and 2025, Michelin has also shuttered operations in France, Germany, Poland, China, and the United States as part of its drive toward efficiency and profitability.
In February, Michelin was reportedly considering accelerating its American investments as a strategic move to counter the threat of potential U.S. tariffs. This reflects the company’s proactive approach to trade-related risks, aiming to bolster local production and reduce exposure to international tariff fluctuations.
While the Queretaro closure in Mexico is primarily driven by product strategy and operational efficiency, Michelin’s broader global adjustments also account for evolving trade dynamics.
Despite these closures, Michelin maintains a positive financial outlook, targeting a segment operating income (SOI) of €4.2 billion by 2026, equivalent to a 14% margin. The company plans to reach this goal primarily through product mix enhancement and operational efficiency.
Citi analysts estimate that the restructuring measures could contribute up to €300 million in additional EBIT by fiscal year 2026 compared to 2024. Historical trends also suggest such moves tend to support Michelin’s share value over time.
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