Michelin’s involvement in Formula E is accelerating the implementation of new developments in road tires, according to a senior exec at the company. The technological aspect is one of three pillars Michelin looks at when entering a motorsports series, said Chris Baker, motorsports director at Michelin North America. “We look at opportunities in motorsports to further our technology efforts because motorsports needs to serve the mainstream business,” he said. “And obviously Formula E is a good example for that.” Baker added that being not only the official tire supplier of the all-electric racing series but also one of its founding partners provided Michelin with the opportunity to shape the championship a bit. “Going in, a non-negotiable point was that we run on 18-inch tire solutions,” Baker said. The company also insisted that the series uses a single tire with a tread pattern for dry and wet conditions. Being able to contribute to Formula E’s setup was important to Michelin, which was looking for the opportunity to introduce a relevant tire-speed diameter in a major open-wheel racing series, Baker said. Michelin believes that F1 with its 13-inch tires and IndyCar with 15 inches are no longer relevant to its road car business. Formula E, however, is a natural training ground for Michelin’s next generation of ultra-high performance tires for road cars that will show up in the market in three to five years. “We used to never see stuff that was used in racing. No matter all the hoo-ha that everybody has heard for years and years,” Baker said. “A whole bunch of it is a bunch of hooey because you’d never see stuff like it actually in tires or pieces and parts that can be bought by normal civilians.” In terms of sustainability, a core premise of Formula E, Michelin has capped the number of fresh tires teams receive on a given race weekend. Baker said the company provides around 200 tires per weekend, while Pirelli will bring upwards of 2,000 to an F1 race. Michelin, together with the FIA and Formula E, is currently looking at limiting the amount of fresh tires even further.
TAKING CARE OF BUSINESS: Contributing and speeding up its normal R&D process is only one benefit of Michelin's motorsport involvements. Racing also underscores and reinforces Michelin’s “go-to-market strategy” of its brands, said Baker. Internally, Michelin refers to this pillar as corporate racing, and it directly affects pillar number three -- revenue. "Why shouldn’t Michelin get its fair share of the customer racing business?" Baker asked. “There are guys who would probably rather go to the racetrack on the weekend than go to the golf course, and in order to do that there are a bunch of consumables.” Baker did not reveal the revenue numbers of the motorsports department but said “we were reasonably happy with last year’s result.” Michelin Group as a whole is a $25B-$28B business -- depending on the exchange rate -- and motorsports is only a fraction of that. “What we concentrate on is the percentage return on revenue,” Baker said. “That’s where we can be as a business unit competitive with the much larger product lines.”
