Senior US lawyer disputes Michelin's fuel economy claims in ads

Greenville, South Carolina -- Michelin North America Inc. has agreed

to pay 17 states $375,000 for the cost of the investigation of alleged

misrepresentations in advertising of its fuel efficient tyres and

modify the ads' claims.

The Tennessee Attorney General's office led a multi-state probe into

the promotional claims made by the Greenville-based tyre maker after

full-page ads of Michelin-brand fuel efficient tyres ran in the Wall

Street Journal and USA Today in 2008. Michelin also advertised the

tyres on radio and television ads on ESPN.

Besides Tennessee, the states involved in the investigation include

Alaska; Arizona; Delaware; Iowa; Kentucky; Massachusetts; Montana; New

Hampshire; New Mexico; North Carolina; Ohio; Pennsylvania; Rhode

Island; Texas; and Vermont.

The ads had taglines of “It's time to fight back. Michelin

fuel-efficient, long-lasting tyres help you save money” and “Michelin

makes the most fuel-efficient line of tyres on the road, which saves

you money over the life of your tyres.”

The investigation-brought about following a complaint by Bridgestone

Americas Holdings Inc.-focused on Michelin's claims, type size and

footnote disclosures in the advertising. The states allege that

Michelin's fuel efficiency ads did not adequately disclose that the

advertised costs savings were based solely on savings in fuel costs,

not on the comparative costs of the competing tyres. The ads did not

mention consumers may save more money by buying a cheaper tyre or other

cost-saving factors, according to the states.

Michelin said it presented test data to the states demonstrating a

major advantage in rolling resistance and related fuel-efficiency

compared to most tyres in its competitive set.

The $375,000 multi-state settlement is to cover the costs of the

investigation for the various attorneys general, said Scott Clark, COO

of Michelin Americas Small Tires.

Additionally, the tyre maker also will modify the ad messages and

increase the font size on the disclaimers that show which competitors

Michelin is comparing itself against, Mr. Clark said.

The new tagline, scheduled to appear May 15, will read: “It's time to

fight back. Michelin makes some of the most fuel-efficient tyres, which

help you save money at the pump.”

It replaces the former ads' claims of “the most fuel-efficient” with “some of the most fuel-efficient.”