Tyre giants want to walk off with £8m grants
Michelin could quit Scotland with £8million of taxpayerfunded machinery.
The French f irm wants to close its Dundee factory – at a cost of 845 jobs – despite having pocketed huge state handouts.
One MSP has said “serious questions would be asked” if government-funded equipment is taken out of the
Michelin could walk away from Scotland with £8million worth of state-of-the-art machinery paid for by taxpayers.
The French tyre giants, who made £ 1.5bil lion in profit last year, have announced plans to close their Dundee factory in 2020, with the loss of 845 jobs.
Their chief executive, Jean-Dominique Senard, took the decision despite having accepted millions in government money as recently as last year. It was used to buy hi-tech kit, which sources say is easily “unbolted and moved”.
The Sunday Mail can today reveal details of the massive sums of grant funding and the industrial equipment it has been used to buy.
One north-east MSP has said “serious questions would need to be asked” if the machinery is taken out of Scotland.
Scottish Enterprise handed over an initial £1.5million portion of a £4.5million grant to modernise the site in June last year.
The money was spent buying the first electronic tyre curing technology to be installed in a large Michelin plant anywhere in the world.
In September 2015, £1.1million was given to the company to establish a “logistics hub” to increase the “capability and longevity” of the Dundee operation.
In 2011, Scottish Enterprise announced a £ 5.2million investment of taxpayers’ cash in the factory.
The money was spent “investing in new state of the art plant and equipment capable of manufacturing the latest energy saver tyre”.
John Reid, Michelin’s Dundee factory manager, admitted in 2012 that his firm had been handed “four or five times” more cash out of the Scottish Government than from any other administration in Europe.
He said: “They’ve given us a level of grant support, investment support, which is second to none.”
The firm refused to give a definitive answer on whether any money would be returned when contacted last week.
A source who has visited the Dundee factory said: “If a final decision is taken to close the plant, this machinery could easily be relocated to one of Michelin’s other 75 manufacturing plants around the world.
“The company are extremely secretive about their technology and what they have that their competitors don’t.
“The factory is hi-tech, they have robots everywhere, in the manufacturing area and in the part of the building where tyres are stacked and stored.
“It was wel l publicised that the equipment the last Government handout funded was the first to be installed by Michelin anywhere in the world.
“If Dundee closes, they aren’t just going to leave it, shut the doors and move on. It’s likely going to be unbolted and shipped to another manufacturing plant in England or abroad.
“The Scottish Government will be furious that closure plans weren’t mentioned when millions of pounds were being handed over last year.
“It seems unlikely that the company wouldn’t have been aware at that point that the long-term future of the place was under threat.”
Conservative MSP for North East Scotland, Bill Bowman, said: “These awards were made in recognition of the work going on in Dundee at the Michelin plant. As such, it would be completely wrong for the equipment bought with this cash to be taken out of Scotland.
“The expectation is any awards should have been agreed in such a way as to prioritise Dundee and the workers.
“If that’s not the case, serious questions would need to be asked.
“And if Michelin can’t find a use for it in Dundee, someone else will.”
Scottish Greens co- convener Patrick Harvie said: “The urgent priority must be to explore every possible way of safeguarding people’s existing jobs.
“At the same time, it’s important that when the public purse is opened for private companies, especially giant multinationals, there’s a guarantee of lasting benefit to the community.
“Michelin have not gone bust. They still have vast assets and if they do walk away from Dundee, they shouldn’t be taking taxpayer-funded equipment with them.”
Scottish Lib Dem leader Willie Rennie added: “I hope Michelin can be convinced to reconsider the decision to close their plant in Dundee but if they’re determined to shut up shop, it would be a welcome gesture to return these funds.”
Documents released to the Sunday Mail under freedom of information laws show
the company received slices of public cash in six of the last seven years.
In 2011, the company were given £35,391, £700,000 in 2012, and £406,340 in 2013. The firm were handed £700,000 in 2014 and £770,000 in 2015.
Scottish Enterprise records also show that Michelin were given £2.701million in 2017.
First Minister Nicola Sturgeon visited the Dundee factory in June that year and announced they would receive a further £ 4.5million of public cash.
The money was to help pay for green technology and to fund machines to produce larger tyres in higher demand with the rise of SUVs.
The tyre curing machine was bought using the first £1.5million of that money, with the other £ 3million still held by Scottish Enterprise.
Michelin blamed the closure of the Dundee plant on lower demand for the smaller premium tyres produced there and an increase in cheap imports from Asia.
Scotland’s Economy Secretary Derek Mackay has formed a group tasked with trying to find a way of saving the plant.
Michelin have agreed to look in detail at any rescue proposal and if a plan is successful, it will almost certainly involve the Scottish Government agreeing to pump in more money.
Mackay said: “The Scottish Government will leave no stone unturned in our efforts to find a viable and sustainable future for the plant and its skilled workforce.
“The action group will work tirelessly to explore all options and provide Michelin with a proposition that demonstrates what support can offered, be it business rates or financial aid, to help retain a presence in Dundee.”
Scottish Enterprise said: “As part of the action group, we are committed to working with partners to protect the future of the Dundee site and will do everything within our powers to find a viable solution and secure employment for the people lef t devastated by this announcement.”
We got four or five times the average that’s given to Michelin abroad
FACT FINDER Derek Mackay visits the factory on Tuesday before announcing the action group IN PERIL Closing the Dundee factory would cost 845 staff their jobs
DECISION MAKERS Senard, right, with previous boss Michel Rollier
STATE OF THE ART Workers in the Dundee factory examine tyres
PAYBACK TIME The Michelin man has done very nicely out of Scotland’s taxpayers INFLATED COSTS Reid shows Sturgeon round the factory last year