What was Michelin Challenge Bibendum doing in China?

One Of The World's Largest Green Car Gatherings In A Place That Needs It

There were any number of things said at the Michelin Challenge Bibendum last week that could easily be taken as platitudes. In the opening address by the CEO of the Michelin Group, Jean-Dominique Senard, for example, we have this: the Challenge has "the goal of imagining and creating the mobility of the future." Does that even have a meaning?

Sort of, yes. At the very least, it means that Michelin poured a lot of money into hosting over 5,000 people from around the world in Chengdu, China for a few days at what has got to be the biggest green transportation event on the planet ( EVS is another monster). For the tire maker, the big event was the release of a " green paper" that tries to live up to the event's unofficial slogan of being an "action tank, not a think tank."

Companies like Tesla Motors push Michelin to work even harder.

What action is that? Pete Selleck, the chairman and president of Michelin North America, told AutoblogGreen that Michelin wants to increase a tire's performance-to-weight ratio by 20 percent, which he called "pretty aggressive." The company's massive R&D budget – $2.38 billion over the last three years – is reaping rewards all over the world. "We thought we had maxed out on what we knew about natural rubber, but we're making investments today on ideas of how you mix carbon black and natural rubber." Traditionally, the two were mixed as solids but Michelin now has operations in Thailand where they are mixed as liquids, which can "dramatically improve the microdispersion of the carbon black inside the carbon molecules," Selleck said, and that can offer up to 40 percent more wear.

Selleck also said that companies like Tesla Motors are pushing Michelin to work even harder. "They will force us to accelerate. We have lots of technologies that we're thinking about because we were planning to lay them in a kind of sequential approach, but when you've got a project like that, you've got to throw everything at it, and that's good for us. Those are the challenges we love to figure out."

A bigger challenge is the issue of transportation and pollution in China, which we investigate below.

BMW i3 at Michelin Challenge Bibendum

Aside from a few key sessions, the Challenge was decidedly not a Michelin affair. There was an updated VIPA autonomous vehicle (the EZ10, see video above) at the ride and drive. Car2go was there, checking out the Chinese market. There were sessions on the transportation situation in China and hydrogen fuel around the world. And much more. Let's call it the wide-spectrum view.

There are about 80-90 cars in China per 1,000 inhabitants in China.

Since the event was held in China, we wanted to get some insight into the specific challenges there. Currently, there are about 80-90 cars in China per 1,000 inhabitants. One way to read that is that there's tremendous room for car sales growth. Another is that the country can go down a different path than the one blazed by developed countries. Daimler's Klaus Mannsperger said that, "Obviously, China is developing very fast," but he does not see China growing so much that "it will have development where the amount of cars will match what we have in the US, some 800-900 cars per 1,000 people. This is just not a feasible scenario," he said.

It's impossible to ignore the fact that cities in China are built on a very big scale. Chengdu is but one example, with highrise buildings scraping the sky downtown and throughout the outskirts. This creates dense urban traffic for miles and miles. Mannsperger said that this situation gives electric vehicle and carsharing programs like Car2go room to make a move. Electric scooters dominate the roads there already. "In such urban developments, there are also possibilities to go for new technologies, green technologies," he said. "If you drive around in the city, electric car are a very good concept. Charging stations can be made available and recharging is possible. However, there are still regions in China where you do not have big cities," and that's where conventional technologies – ICEs and hybrids – will continue to rule, he said.

There were blue skies in Beijing for the recent APEC meeting (where US President Obama and Chinese President Xi Jinping announced a new climate change agreement), but they're gone now. The country's air pollution was certainly a source of discussion during our time in Chengdu, but transportation is only one part of the problem. As Mannsperger said, "vehicles alone will not make the difference if there is not a total drive, also in heavy industry and power generation, towards greener technologies scenarios." Where's the Challenge Bibendum for that?

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Address by Jean-Dominique Senard
CEO Michelin Group
Michelin Press Conference
November 13, 2014

Ladies and Gentlemen,

I wish to welcome you all.

On behalf of the Michelin Group, I want to personally thank you for accepting our invitation to take part in the 2014 Michelin Challenge Bibendum.

As Chief Executive Officer of Michelin, I would like to say that your presence is both an honor and a pleasure. Your attendance is proof of your interest in the approach that the Michelin Group is taking within the framework of this event, which for us – and perhaps for you – is much more than just an event. In reality, it is a comprehensive, global push for sustainable mobility.

[An exceptional effort]

So, how can we define the Michelin Challenge Bibendum? First and foremost, it expresses a commitment to federating stakeholders in the mobility sector, with the goal of imagining and creating the mobility of the future. This initiative is supported not only by Michelin but also by all our partners, to whom I would like to extend my warmest thanks. The event has become a collective initiative that addresses a collective challenge, which is to reconcile the development of mobility with sustainable development, meaning respect for people and their environment. At a time when many of our fellow citizens see the mobility of people and goods as a threat to the environment – and even a threat to the economy and society – Michelin believes that mobility plays a fundamental role in human development and is a fantastic driver of progress. This deep conviction, which we want to share with all of the Group's shareholder, is what makes Michelin tick, allowing us to constantly innovate with passion to give everyone a better way forward.

Promoting sustainable mobility at the global level is the slightly gargantuan goal of the Michelin Challenge Bibendum. But it's more than a dream or a utopia. Today, and every day, technological innovation is helping to improve the environmental, safety and cost performance of all means of transportation, whether individual or collective.

[Michelin, innovation serving sustainable mobility]

Quality and innovation are the DNA of the Michelin brand. Thanks to this combination, we are working every day to build the future of transportation.

As you undoubtedly know, Michelin is ranked among the 100 most innovative companies in the world. A few figures testify to the ambition of our innovation strategy: €1.9 billion invested in research and development over the past three years, 6,000 employees working in R&D, 250 patents filed on average each year and a portfolio of patents that has tripled in ten years. This is because we want progress to be sustainable.

Because the Group believes that performance and responsibility must go hand in hand, Michelin's ambition is to be an undisputed leader in sustainable mobility, as well as one of the top-performing, innovative and responsible companies in the world. To achieve that goal, the Group has set objectives for 2020 in six key areas to support its leadership strategy and make mobility safer, more efficient and more environmentally friendly for everyone.

I'd like to take a minute to focus on two of these objectives:

1. First, Product Performance Leadership, which means more performance with fewer materials while ensuring greater energy efficiency. Product improvements will enable vehicles to reduce overall fuel consumption by more than 3 billion liters over a tire's lifespan in 2020, thereby reducing carbon emissions by nearly 8 million tonnes.

2. Second, fostering better life through sustainable mobility, notably by:

- Stepping up initiatives to improve road safety. Road traffic violence is trivialized and too often goes unnoticed. Nonetheless, its scope is that of a truly global epidemic. Over the past ten years, Michelin has also developed a large number of road safety programs in countries in which it has manufacturing and sales facilities, working in partnership with numerous organizations and global institutions, including the FIA in 2011, the United Nations and the European Commission.

- Advocating renewable and recycled solutions for a circular economy. In a world with finite resources, the basic idea behind the circular economy is to use those resources more wisely. In other words, to do more and better with less. This covers all resources used, from water to raw materials to energy. Michelin's idea is to simultaneously activate four levers covering the tire's lifecycle, thereby providing a combination of solutions to ensure that resources are used more wisely. This is what is known as the "4R" Strategy (Reduce, Reuse, Recycle, Renew).

For more than twenty years, our innovation programs have focused on delivering sustainable mobility solutions, and as you have just heard, we intend to strengthen this focus in the years ahead. As the initiator of major breakthrough technologies like the radial tire and the fuel-efficient tire, Michelin enjoys an undisputed lead in advanced technology product segments.

As you can see, Michelin is fully committed to innovation.

This commitment involves all types of innovation, from continuous innovation (to improve the performance of our tires with each new range) to breakthrough innovation (to address new mobility challenges).

This commitment also involves all types of tires, whether for cars, vans, trucks, civil and military aircraft, farm machinery, mining equipment, lunar exploration modules, handling equipment, metros, tramways, motorcycles, scooters or bicycles.

Michelin holds forefront positions in all of these segments thanks to its ability to pack more performance into the same tire. While certain aspects of performance, such as safety and longevity, tend to contradict each other, Michelin has achieved the technological feat of continuously improving all performance factors together.

You can see this remarkable capacity for innovation for yourself on the Michelin stand. The products we wanted to showcase include:

Ultraflex technology, which meets the needs of farmers and equipment manufacturers. Michelin tires made with this technology benefit from a unique rubber compound and a unique architecture that make it possible to carry heavy loads and operate at very low pressure. This architecture is designed to attain three goals: protect farmland, increase load capacity and reduce fuel consumption. Thanks to Ultraflex technology, farmers work faster and use up to 10% less fuel.

Michelin Near Zero Growth (NZG) technology, which provides tangible, innovative solutions to challenges facing today's aviation industry. Thanks to this technology, Michelin tires can make twice as many landings as traditional tires, while reducing the number of maintenance outages. As a result, they are much safer and more economical to use and meet our objective of reducing consumption of raw materials. To give you an idea, a tire made with NZG technology weighs 11 kg less than a cross-ply tire and 2 to 3 kg less than a traditional radial tire.

Michelin has also developed innovations that represent a real breakthrough for the mobility sector.

The first Formula E championship race, which was held in Beijing and about which many of you are very excited, is already a major success for Michelin. As the sole supplier for all the teams entered in the championship, we purpose-designed a tire adapted to the special requirements of this spectacular competition, which takes place entirely in cities around the world and thus in all weather conditions. This revolutionary 18-inch tire is well suited for passenger cars. In addition, thanks to its good performance on both wet and dry roads, the tire does not need to be changed during the race, thereby saving raw materials. In this way, we use motorsports as an experimental laboratory for street tires.

To facilitate mobility on the road, Michelin has developed Selfseal technology, which integrates a unique rubber compound that immediately plugs holes in the tread. This is a considerable advance. On average, tires puncture once every 75,000 km in European countries but once every 3,000 km on roads in certain other countries around the world. This gives you an idea of the innovation's importance. Michelin tires made with Selfseal technology will be marketed beginning in 2015.

In addition to innovative products, Michelin also innovates in the area of services.

Vehicle performance is crucial. However, what will shape the future of transportation is how we are going to use mobility. Michelin is fully aware of this fact. With the development of Michelin Solutions, we have made the Group a pioneer in the functional economy. We rely on a unique ecosystem of partners that are carefully selected for their expertise in telematics, electronics and fleet management.

We also promote mobility every day through our unrivaled collection of maps and guides, as well as a full range of digital travel assistance services. Today, these products have become – like the MICHELIN guide and the stars it awards to restaurants – global benchmarks that are recognized by professionals and the general public. It's through these innovations that we support millions of travelers every day, providing them with enhanced service, enjoyment and safety.

For Michelin, the Challenge Bibendum involves much more than showcasing our capacity for innovation.

[The Challenge Bibendum: a public interest project]

In just a few years, mobility and sustainable development have become a political issue for society. A collective discussion involving mobility sector companies and all civil society stakeholders is required to address this issue effectively. At Michelin, we are pioneers in this process.

The Michelin Challenge Bibendum is today the spearhead / prototype of the system of exchanges, discussions and actions that must be more widely deployed around the world to provide solutions to the challenges of sustainable mobility.

Bringing together carmakers, OEMs, public and private-sector operators, academics, members of research institutes, political officials and NGOs, the Michelin Challenge Bibendum is today the only / one of the few idea laboratories where a shared project dedicated to the mobility of tomorrow can be prepared and promoted – thanks to you – in a public forum.

That is the ambition of this global summit, which this year will be tangibly reflected in the presentation of a Green Paper prepared over the past year. This event is now a permanent platform, a "think and action tank" dedicated to the mobility of the future, whose aim is to become a global benchmark in this area.

(The Michelin Challenge Bibendum: inventing sustainable mobility)

It's clearly not by chance that we have chosen to organize the 12th Challenge around the theme of "innovative mobility to drive growth and urban well-being." Over 50% of the world's population currently lives in an urban environment; more specifically 80% in North and Latin America, 75% in Europe and 40% in Asia. As you know, pollution and traffic congestion are becoming the most significant obstacles to the mobility of people and goods. No one today has ready-made solutions that can deal with the consequences of the development of urban mobility, a phenomenon that will continue in the years ahead. These solutions must be invented.

It's also not by chance that we decided to hold the 12th Michelin Challenge Bibendum in Chengdu, China. In Sichuan Province, the automobile industry grew by 40% last year, making it China's third-largest production region. The city is home to many companies in high-tech industries such as information systems and aeronautics. But we didn't choose China just because it's one of our markets and economic partners. Above all, we chose China because this enormous country sums up the most important question about sustainable mobility worldwide, which is how to provide wide access to mobility while protecting the environment and ensuring safety. Again, no one at present has ready-made solutions. They must also be invented.

The media clearly have a key role to play in understanding and discussing sustainable mobility. The technological, political and societal challenges in this area are enormously complex and difficult to grasp. The Michelin Challenge Bibendum makes it possible to bring together, in the same place and at the same time, a large amount of knowledge and many facts about sustainable mobility. With its presentations, experiments and conferences, the Michelin Challenge Bibendum offers rich, varied resources for building an action plan so that sustainable mobility can become a global and local reality, everywhere and for everyone. I hope that the unique ecosystem presented here will help to nurture this vision of a world of lasting progress.

[The Michelin Challenge Bibendum is an extension of Michelin's core values]

All companies want to achieve their objectives. What sets Michelin apart is that it wants to achieve its objectives while respecting its values.

Because Michelin has always embraced these values and our partners appreciate them every day, they represent a competitive advantage that must be maintained. These values are respect for people, customers, the environment and shareholders
Lastly, the Michelin Challenge Bibendum is fully aligned with the Group's historic missions: To promote progress based on innovation; innovation imagined by people for people; innovation that leaves no one behind, that is all-inclusive; innovation that helps to effectively improve the well-being not only of people who use our products, but also of society as a whole.

In a nutshell, proudly expressing the responsibility of an entire corporate community that is fully and directly involved – that's what the Michelin Challenge Bibendum is all about.

Thank you for your attention.

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