Michelin buys a 40% stake in France’s biggest online tire retailer
May 5, 2015 01:56 PM
One of the world’s biggest tire manufacturers is buying a stake in one of the biggest online tire retailers in France.
The Michelin Group, which manufactures and sells nearly 18 million tires in 170 countries annually, is spending 60 million euros ($67 million) to acquire a 40% stake in Allopneus SAS, a large web-only retailer of tires and No. 122 in the Internet Retailer 2014 Europe 500 Guide.
The ownership stake in Allopneus will give Michelin an e-commerce marketing and technology program to better understand how online shoppers in France, Europe and across the world research and buy tires online, says Michelin CEO and managing general partner Jean-Dominique Senard.
In France three out of four consumers research buying tires online, Michelin says. By building a strategic partnership with Allopneus, Michelin will expand its online range and commercial presence. “The Michelin Group will become more adept at dealing with the different modes of online and offline searches and purchases, thereby pursuing its strategy to improve the services offered to customers,” Senard says.
Allopneus, which generated Internet Retailer-estimated web sales of 200 million euros in 2014 ($223.3 million) has been selling online in France since 2004. The web retailer claims to sell more than 3 million tires annually and, in addition to stocking its own inventory, has relationships with 5,000 tire installation specialists across France.
The deal with Michelin helps Allopneus connect to a bigger company with deeper financial resources in order to grow its sales and customer base, says Allopneus founder and CEO Didier Blaise. “Allopneus has been able to transform a consumer trend into a solid business model and will be able to accelerate its growth by benefiting from the strength of the Michelin Group,” Blaise says.
Michelin, which currently does not sell online, generated revenue of 19.55 billion euros ($21.83 billion) and net income of 1.03 billion euros ($1.15 billion) in 2014.