Monday, April 27, 2020

After Closing for the Virus, Is Michelin Moving Too Quickly?

Michelin is an early starter among global manufacturers seeking to revive business safely in the midst of the coronavirus pandemic. A gradual reopening is being tested after the outbreak temporarily shuttered plants in China, Europe and the United States, affecting 127,000 employees.



“We can’t stay confined forever,” Florent Menegaux, Michelin’s chief executive, said by telephone recently. “Just after the health crisis, we’re going to have an economic crisis looming which will have huge social consequences. We have to learn how to live with Covid-19.”






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Credit…Elliott Verdier for The New York Times



But in France, where Michelin is based, the piecemeal rollout has ignited tensions with labor unions. They accuse the company of putting investor interests above employees while transmission of the disease is still high and while France remains under quarantine.




“People don’t have the right to circulate freely, but at the same time we’re told we have the right to work next to one another to make tires,” said Jean-Paul Cognet, who represents the Confédération Générale du Travail union in Clermont-Ferrand, the city in central France where Michelin has its headquarters.




“Michelin is trying to reassure financial markets by showing that they’re capable of producing,” Mr. Cognet added. “But at what cost?”




The question is echoing worldwide as companies seek to rebound from lockdowns that have exacted a devastating economic toll. In the United States, Europe and China, governments are calling for more emphasis on getting vital industries back on track, forcing executives to strike a balance between keeping their businesses alive and their employees safe.




France, where nearly 23,000 have died from the virus, has become a crucible for these tensions. The pandemic spurred organized labor to reassert influence after years of decline. Unions have leveraged the crisis to press companies from Amazon to the auto giant PSA Peugeot Citroën on workers’ rights.




The main employer organization, the Movement of the Enterprises of France, has called for an immediate reboot of France’s “economic machine,” and urged people to “work a little bit more” to make up for lost time, stoking widespread ire.




Michelin, whose rubbery Michelin Man mascot is well known around the globe, is caught up in the debate. It began calling back some of its 20,000 French employees on April 1, earlier than most big French manufacturers.




The company justifies its early restart by pointing to the trucks, farm machinery, ambulances, fire engines and other essential vehicles still operating despite national quarantines. Michelin is reopening its European plants that produce tires for these vehicles, which make up about half its business.




But the company has also resumed the production of molds used to make tires for high-end cars manufactured by the likes of Porsche and Tesla. Michelin is eager to restore passenger car tire production generally, Mr. Menegaux said, and is betting on a surge in people driving, partly to avoid crowded public transportation, when confinement orders are lifted.





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Credit…Elliott Verdier for The New York Times

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Credit…Elliott Verdier for The New York Times


Unions in France, however, challenged the company’s motives as it began to reactivate employees on a voluntary basis from paid furloughs. The plan calls for the work force to return in gradual increments over several months.




“Making tires for luxury cars like Porsches is not essential,” said Jérôme Lorton, the spokesman for the Union Syndicale Solidaires, one of France’s biggest industrial unions. “Protecting workers by keeping them at home during a quarantine is.”




For Mr. Menegaux, an equally potent danger is the economic risk of not resuming production quickly. “I understand the fear that exists,” he said. “I also have fear about Covid-19.”




“But making sure that we are in a position to pay the salaries of our people is of vital importance,” he said. “We can’t live with a 50 percent loss of revenue for a long time,” he added. “Customers need tires. And in order to sell tires, we need to produce.”




A reserved, straight-talking man who spent most of his career at Michelin, Mr. Menegaux, 57, said he was applying lessons learned in China, where its three plants were forced to close through Feb. 10 as the coronavirus bore down.




Michelin’s crisis teams determined in late February that the virus would hit Europe hard and ripple to the United States. They closed sites quickly in Spain, Italy, France, Germany, Britain, the Nordic countries and Eastern Europe to prepare them to reopen with new safety protocols as early as possible.




A new safety regimen for all plants includes adjusted shift schedules to allow extra time for social distancing on arrival and departure at plants, the disinfecting of work stations between shifts, temperature checks and medical screening on arrival, and ample stocks of masks.




None of Michelin’s 8,000 employees in China has gotten the coronavirus since returning to work, Mr. Menegaux said. Two employees from Michelin’s 69 factories in 17 countries died from the virus, which in both cases was contracted outside its facilities, he added.





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Credit…Elliott Verdier for The New York Times

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Credit…Elliott Verdier for The New York Times


In the United States and Canada, where some of Michelin’s 19 plants were temporarily shut, sites producing tires for trucks and earth movers have partly reopened. Some others that make passenger car tires remain on standby because of lack of demand, Mr. Menegaux said.




Michelin said it wasn’t testing employees for the virus in France because health agencies weren’t recommending it. But the company has moved to secure its own health supplies by adapting some factories to produce 400,000 surgical masks a week and thousands of gallons of hand sanitizer. It also designed a new silicone-based N95 respirator mask for employees that can be reused up to 100 times.




“I’m telling people they’ll be safer inside our plants than outside,” Mr. Menegaux said.




The unions aren’t so sure. At Michelin’s factory in Cholet, a site in western France where 20 percent of the work force was called back this month, labor leaders filed an internal complaint, saying management was exposing employees to “serious and imminent danger.” They cited a shortage of masks and gloves, the lack of virus tests and an inability to work six feet apart at some machines.




“Employees are already reporting difficulties in maintaining social distancing,” said Mr. Lorton of the Union Syndicale Solidaires. As the company brings more workers back, “it’ll be impossible,” he said.




Michelin said it had addressed the issues and was providing the most protective masks to employees working close together. “I would never put the lives of employees at risk,” Mr. Menegaux said.




The employee callbacks are voluntary — for now. As confinements end, reigniting demand for tires, “at some point there will be some pressure and everyone will have to work,” he said.




Mr. Lorton said unions “won’t block the doors of the factories,” even if employees remain wary. At the end of the day, workers are even more fearful of losing their jobs if the company’s sales and profit slump.





“What we fear is that the world will change, and we won’t be able to work like before,” he said.


For Mr. Menegaux, the coronavirus is the worst crisis for Michelin since World War II, when plants in France were bombed and employees killed.





The aim today, he said, is to recover swiftly — and safely — to make sure employees and the company remain in good health.




“After confinements end, everyone will have to live with Covid one way or another,” he said.










  • Updated April 11, 2020



    • When will this end?


      This is a difficult question, because a lot depends on how well the virus is contained. A better question might be: “How will we know when to reopen the country?” In an American Enterprise Institute report, Scott Gottlieb, Caitlin Rivers, Mark B. McClellan, Lauren Silvis and Crystal Watson staked out four goal posts for recovery: Hospitals in the state must be able to safely treat all patients requiring hospitalization, without resorting to crisis standards of care; the state needs to be able to at least test everyone who has symptoms; the state is able to conduct monitoring of confirmed cases and contacts; and there must be a sustained reduction in cases for at least 14 days.




    • How can I help?


      The Times Neediest Cases Fund has started a special campaign to help those who have been affected, which accepts donations here. Charity Navigator, which evaluates charities using a numbers-based system, has a running list of nonprofits working in communities affected by the outbreak. You can give blood through the American Red Cross, and World Central Kitchen has stepped in to distribute meals in major cities. More than 30,000 coronavirus-related GoFundMe fund-raisers have started in the past few weeks. (The sheer number of fund-raisers means more of them are likely to fail to meet their goal, though.)




    • What should I do if I feel sick?


      If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.




    • Should I wear a mask?


      The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing.




    • How do I get tested?


      If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.




    • How does coronavirus spread?


      It seems to spread very easily from person to person, especially in homes, hospitals and other confined spaces. The pathogen can be carried on tiny respiratory droplets that fall as they are coughed or sneezed out. It may also be transmitted when we touch a contaminated surface and then touch our face.




    • Is there a vaccine yet?


      No. Clinical trials are underway in the United States, China and Europe. But American officials and pharmaceutical executives have said that a vaccine remains at least 12 to 18 months away.




    • What makes this outbreak so different?


      Unlike the flu, there is no known treatment or vaccine, and little is known about this particular virus so far. It seems to be more lethal than the flu, but the numbers are still uncertain. And it hits the elderly and those with underlying conditions — not just those with respiratory diseases — particularly hard.




    • What if somebody in my family gets sick?


      If the family member doesn’t need hospitalization and can be cared for at home, you should help him or her with basic needs and monitor the symptoms, while also keeping as much distance as possible, according to guidelines issued by the C.D.C. If there’s space, the sick family member should stay in a separate room and use a separate bathroom. If masks are available, both the sick person and the caregiver should wear them when the caregiver enters the room. Make sure not to share any dishes or other household items and to regularly clean surfaces like counters, doorknobs, toilets and tables. Don’t forget to wash your hands frequently.




    • Should I stock up on groceries?


      Plan two weeks of meals if possible. But people should not hoard food or supplies. Despite the empty shelves, the supply chain remains strong. And remember to wipe the handle of the grocery cart with a disinfecting wipe and wash your hands as soon as you get home.




    • Can I go to the park?


      Yes, but make sure you keep six feet of distance between you and people who don’t live in your home. Even if you just hang out in a park, rather than go for a jog or a walk, getting some fresh air, and hopefully sunshine, is a good idea.




    • Should I pull my money from the markets?


      That’s not a good idea. Even if you’re retired, having a balanced portfolio of stocks and bonds so that your money keeps up with inflation, or even grows, makes sense. But retirees may want to think about having enough cash set aside for a year’s worth of living expenses and big payments needed over the next five years.




    • What should I do with my 401(k)?


      Watching your balance go up and down can be scary. You may be wondering if you should decrease your contributions — don’t! If your employer matches any part of your contributions, make sure you’re at least saving as much as you can to get that “free money.”











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After Closing for the Virus, Is Michelin Moving Too Quickly?

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