Michelin to build $270m distribution center in S.C.

© Michelin

Michelin to build $270m distribution center in S.C.

Michelin will start construction on a $270 million distribution center in Spartanburg County, South Carolina, later this year. The first phase of the center is expected to open in late 2017, with completion expected in early 2019. Michelin says the center will create about 350 jobs in the area.

Set in an ideal location

The center will feature five buildings covering about 3.3 million square feet and will support distribution of tires under Michelin, BFGoodrich and Uniroyal brands for passenger vehicles, heavy trucks and agricultural equipment.

Swisslog Group will automate distribution warehouse operations for receiving, tire selection, sequencing and shipping, which Michelin says should result in significant gains in efficiency, speed and ergonomic conditions.

The distribution center is conveniently located near seven Michelin tire plants across South Carolina’s Upstate region, as well as the company’s Greenville-based headquarters for North America and other Michelin facilities.

“The Spartanburg distribution facility will cap a multi-year evolution of Michelin’s distribution network in North America. We see it as a transformational milestone designed to better serve our customers while optimizing inventories and improving supply efficiency,” said Pete Selleck, chairman and president of Michelin North America.

Move follows outrage over online sales in N.C.

Recently Michelin angered tire dealers by rolling out a pilot program of selling its BFGoodrich tires direct from its website to customers in the greater Charlotte area of North Carolina.

BFGoodrich claims this will “simplify” the tire buying process for consumers, who will be able to “research and purchase tires as well as schedule an installation appointment in one location.”

“This is an important evolution in the tire purchasing process,” said Scott Clark, chief operating officer of BFGoodrich parent company Michelin North America. Clark said the company had expected a reaction from a “small group” of dealers but saw the move to selling online as a “positive step for both consumers and tire retailers.”

Many tire dealers Traction News spoke to said the feeling among independent tire dealers was one of a “betrayal of trust” and dealers were concerned they would now be competing against their own vendor. Many said they would consider not stocking Michelin tires in the future.

However Michelin defended itself against the accusations, saying it would not “seek a short-term gain that actively undermines the valuable dealer relationships that BFGoodrich and Michelin have spent decades developing.”

“Because Michelin doesn’t own any of our own retail stores, this program is successful when we partner with our retailers and create/deliver real consumer value,” Clark said. “We understand their concerns and we are working hard to detail the components of our program directly with them.”

Clark said the program is being rolled out and Michelin is in the process of signing up service partners now and was “talking personally” with its dealer network about the details of the program.

The company plans to roll out the program across the U.S. in phases this year with the goal of being nationwide in 2017.

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