PARIS -- Michelin Group's No. 1 task after the May 26 death of co-CEO Edouard Michelin is to execute the strategy that the company's top echelon worked out under his direction, says new CEO Michel Rollier.
"The strategy is in place. Our task is to roll out this strategy," says Rollier, who previously shared the CEO job with Edouard Michelin.
Earlier this year, Edouard Michelin laid out several performance goals, including achieving an operating margin of 10 percent or more by 2010 through a combination of internal cost controls and focused growth. The company's operating margin was 8.8 percent last year.
The 10 percent goal has come under pressure from higher-than-anticipated raw-material costs. That has caused some stock analysts to revise downward their projections for the company.
Rollier acknowledged the pressure from rising raw-material costs, especially the "surprising" surge in the price of natural rubber.
But he views the challenge as an opportunity for innovative companies such as Michelin to tackle the problem internally through cost controls and r&d.
"Our world is ruled by expensive commodities," Rollier said last month at his first public appearances as the sole CEO. Rollier spoke at the 2006 Challenge Bibendum event, held near here.
Natural rubber accounts for about 25 percent of the company's commodities costs. That is why Michelin's r&d team constantly is working on ways to improve the company's ability to substitute synthetic rubber where possible, Rollier said.
Rollier and Didier Miraton, Michelin's top-ranking r&d executive, also stressed a vision championed by Edouard Michelin to produce a tire that delivers twice the life while using half the natural resources.
Rollier also assured the public that he's in charge, saying: "There is only one CEO at Michelin. I am that man."
Whether the company's executive board might decide at a later date to name a co-chief executive, as had been the case before Edouard Michelin's death, is a matter for the directors on the board to take up, Rollier said.
Rollier, 62, has been with Michelin since 1996. He became a general partner of the company in May 2005 alongside Edouard Michelin and Rene Zingraff, who retired at the most recent annual meeting, May 12.
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