ATLANTA -- He could be Michelin & Co.'s greatest strength, or its greatest weakness.
Or maybe both.
The mystique of Francois Michelin seems to grow like the company's sales: from about $1.5 billion in the early 1970s to about $10 billion this year.
Here is what analysts and executives say about the 64-year-old Frenchman:
He is compared with the long-haired, long-fingernailed Howard Hughes. He looks like a mad professor. He's brilliant. He's a genius. He's got tires running through his veins. He dresses poorly. He drives an old car through the French countryside. He's a maverick. He's a benevolent dictator. He's paranoid.
"He's very much the soul of the company," said Stephen Reitman, an analyst with the London securities firm UBS Phillips & Drew. "There's basically Francois Michelin and a close circle" running the company, which now sells more tires than Goodyear Tire & Rubber Co. and Japan's Bridgestone Corp., he said.
The reclusive Michelin made a rare public appearance in the United States recently at the annual convention of the National Tire Dealers and Retreaders Association (NTDRA) in Atlanta. It was his first speech in the United States since the European giant completed the acquisition earlier this year of Akron's Uniroyal Goodrich, the move that clearly vaulted Michelin to the No. 1 position in the global tire industry.
But if the world was waiting for compelling insight or some glimpse of the executive's wit and wisdom, it was to be disappointed.
In a 10-minute speech to about 1,600 tire dealers and executives, Michelin spoke in heavily accented English: Concentrate on service. Technical advancements in the tire industry will be small. Stick to long-term goals.
In closing statements, Michelin departed from his prepared text and said of the $1.5 billion Uniroyal Goodrich acquisition: "It is not a purchase, it is an alliance. It is not a takeover, it is common sense."
After "God Bless America" was sung and the meeting adjourned, Michelin and his top-ranking U.S. executive, Carlos Ghosn, slipped out through the curtains on the stage.
Gone. No questions from the audience. No interview with reporters. Just a text of the speech.
One dealer summed it up: "I don't think God knows what Michelin is going to do next."
The developer and first marketer of the radial, Michelin long ago zoomed past Firestone, whose attempt in the late-1970s to rush a radial to market resulted in the Firestone 500 tire recall disaster.
The acquisition of Uniroyal Goodrich came after several years of mergers and alliances in the global tire industry. To some, Michelin's move was a bold grab at market share in the United States.
The innocent-looking Michelin baby commercials and the smiling, rotund mascot, Mr. Bibenbum, don't fool tire industry executives. They know of Michelin's credo: Damn the unions, damn the shareholders, produce quality products, remain secret and spend, spend, spend on research and development.
At the tire-dealer meeting, the lanky Michelin rambled into the auditorium in the Georgia World Congress Center. Dressed in a suit, partly bald and nails neatly trimmed, the founding family scion took his seat with eight other Michelin confidants and one newcomer, Akron executive Sheldon Salzman. As Uniroyal Goodrich president, Salzman helped navigate the purchase past Justice Department officials, who had worried that a Michelin-UG team could control U.S. tire prices.
The tire-dealer group, with help from the State Department, had persuaded the French executive to attend its annual convention in Atlanta to accept an award for technical excellence.
NTDRA officials acknowledge that Michelin, which sells millions of tires through high-volume, low-price wholesale clubs and mail-order clubs, is not its favorite company. Those low-price outlets threaten the livelihood of the corner tire dealers that sell at a higher price and provide such services as wheel alignment.
"If you are only to honor people you agree with, you are never going to honor anybody," said Tony Hylton, NTDRA spokesman.
"They were a company that was dominated by the technical side of the business," said Jose de la Torre, the director of International Business Education and Research at the University of California at Los Angeles who has written extensively on Michelin. That emphasis on technical aspects actually has hurt the company, too: Michelin has been slow to respond to changes in the marketplace, such as the move to all-season tires and, later, the popular performance tires.
In the United States, Michelin has grown since the early 1970s from a sales operation with a few hundred employees to a major manufacturer with 12,500 employees and an estimated $2 billion in sales this year.
Michelin bought Uniroyal Goodrich to win market share and enjoy the benefits of size.
However, French company officials have said that Uniroyal Goodrich will remain a free-standing unit reporting to Michelin's headquarters in Clermont-Ferrand, France, not the U.S. Michelin headquarters in Greenville. Michelin officials continue to keep quiet about possible changes at UG.
But financial results released the day before Michelin's speech in Atlanta showed that the company must cut costs. For the first six months of 1990, sales had fallen to $4.3 billion, compared with $4.5 billion during the same period a year ago.
More important, the company lost $69.5 million, compared with profit of $291.5 million during the same six-month period in 1989. Operating profit for the first six months of 1990 was down 40 percent, which is consistent with the rest of the tire industry.
And Michelin, which prides itself on being a cradle-to-grave employer, took a $62.7 million charge related to 2,260 layoffs on its home turf, Clermont-Ferrand.
European analyst Philip Ayton said of the Clermont-Ferrand workers: "They live in a Michelin-provided house and they drink in a Michelin-provided pub. You live and die for Michelin."
If Michelin has an Achilles' heel, it could be its total debt, estimated by an analyst to have risen from $4.1 billion to $5.9 billion since the acquisition of Uniroyal Goodrich. Others say that the $5.9 billion is not too high but agree that debt is a problem.
Michelin followers note that when the company lost more than $1 billion between 1980 and 1985, it was carrying high debt, too.
"That's what almost killed them in the early 1980s," de la Torre said.