TITAN International Inc. and the French industry minister have been exchanging tirades, with the latter accusing the former of being “insulting” and “extremist”.
Arnaud Montebourg, France’s Minister of Industry and Growth has accused Maurice Taylor, CEO of US tyre maker Titan of hurling derogatory remarks pertaining to reasons why he would not invest into France, and his disapproval of alleged French work practices.
Taylor has bowed out from an earlier offer of purchasing the Goodyear Dunlop Tyres France (GDTF) in Amiens in northern France after its trade union blocked the transaction.
For five years, GDTF had been resuscitating its operations, downsizing to cut losses despite strong opposition from its trade union.
Titan, which has acquired a number of Goodyear plants worldwide, entered negotiations in 2012 to buy the Amiens factory, with plans of closing down its consumer tyre business and focusing on agricultural products. This would mean cutting the workforce in half, something that the union objected to. By end of January, GDTF officially announced that it was folding up.
With key income target to be met and the threat of surmounting deficit, Montebourg asked Taylor’s company for a re-negotiation after the unions had apparently reconsidered their position.
“How stupid do you think we are?” Taylor responded in writing, “We would be nuts to … spend millions of US dollars to buy a tyre factory in France paying some of the highest wages in the world, ” he furthered.
Detailing why he thought investing into this company is not profitable, Taylor said that French workers only work for three hours a day, and spending the rest of the time taking breaks and talking, not to mention that they are amongst the highest paid.
He went on by accusing the French government of being apathetic and short-sighted amidst competition from Asian countries.
Raising the ire further, he said that he intended to buy a Chinese or Indian manufacturer instead and import cheap tyres into the French market.
Montebourg responded with an open letter published across French media, saying that Taylor’s ideas “are as extremist as they are insulting, while showing a perfect ignorance of our country.”
Citing historical back story between the US and France, the minister expressed that both their countries have had mutual regard for one another, undermining Taylor’s observation against the French. He also added that a large number of US companies have been operating profitably in France.
“The truth is far from your ridiculous and derogatory remarks. All these companies know and appreciate the quality and productivity of the French workforce,” the Minister wrote.
“I would remind you that your company, Titan, is 20 times smaller than [French tyre giant] Michelin … and 35 times less profitable, ” he said, adding, “Rest assured, you can count on me to monitor … with redoubled vigilance the import of your tyres to France.”
“The relevant authorities will pay particular attention to their compliance with our high environmental and technical standards, as well as the human conditions in which they are made,” he concluded.