Michelin Shares Drop on Weaker Volumes

Dow Jones10-21

Michelin shares fell Wednesday as the French tire maker reported a drop in third-quarter sales volumes.

Shares were 4.5% lower in early Paris trading.

The company reported a 0.6% drop in third-quarter volumes on year versus a company-compiled consensus looking for 0.6% growth.

Analysts at Jefferies said the update is incrementally negative, while the expected volume rebound has been pushed out.

"Michelin now expects slightly negative volumes in 4Q and FY26, versus previously expecting a rebound," the bank said. "Weaker demand and high import flows are the main drivers."

Michelin said that for the first nine months overall, volumes continued to be weighed down by lower sales of tires directly to automakers who then fit them on new vehicles rolling off the production line.

Replacement tires proved more resilient though, with Michelin-brand volumes rising 4%, it added.

Full-year guidance was reiterated, with operating income still expected to be higher on year and free cash flow seen above 1.6 billion euros ($1.8 billion), and Deutsche Bank analyst Christoph Laskawi said that while guidance is confirmed, the market focus is on volumes for Michelin's equity story.

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