Office of the Attorney General
Attorney General Conway Announces Settlement With Michelin North America, Inc.
Kentucky Attorney General Jack Conway, along with attorneys general of 16 other states, today announced a multistate settlement with Michelin North America, Inc. of Greenville, S. C., regarding alleged representations Michelin made in its advertising of fuel-efficient tires. The multistate investigation also involved the states of Alaska, Arizona, Delaware, Iowa, Massachusetts, Montana, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Pennsylvania, Rhode Island, Tennessee, Texas and Vermont.
The attorneys general allege that in May or June of 2008, Michelin advertisements began promoting savings associated with its fuel-efficient line of tires. Some were full-page ads that ran in the Wall Street Journal and USA Today newspapers, as well as radio and television advertisements on ESPN during athletic events, such as SEC football games. The ads ran when gasoline prices were near or in excess of $4 per gallon. The ads contained representations such as, “It’s time to fight back. Michelin fuel-efficient, long-lasting tires help you save money,” and, “Michelin makes the most fuel-efficient line of tires on the road, which saves you money over the life of your tires.”
The states allege that Michelin’s fuel-efficiency advertisements did not adequately disclose that the advertised cost savings were based solely on savings in fuel costs. There are factors other than fuel efficiency that might affect the savings a consumer could achieve by choosing one tire over another, such as the initial cost of the tire and the average life of the tire in terms of mileage. Further, the states review of Michelin’s own studies indicates that its tires are only the most fuel-efficient in 78 percent of its classes of tires. However, in some classes of tires, a Michelin tire was not the most fuel-efficient. The states also expressed concern that footnote disclosures used by Michelin in the fuel-efficiency advertisements were not clear and conspicuous.
The states acknowledge that Michelin fully cooperated with the multistate investigation and the investigation did not question the safety or quality of Michelin’s tires. Michelin denies any wrongdoing.
“My office will continue its efforts to ensure consumers can rely on claims made by companies when promoting their products,” General Conway said. “Additionally, I want to take this opportunity, with the upcoming summer driving season approaching, to urge all Kentuckians to check their tire pressure regularly and to make sure to load the vehicle according to the directions of the manufacturer. Following these instructions will not only improve your gasoline mileage, it will help avoid catastrophic tire failures that can result when the tire pressure is too low, or when the vehicle is loaded with too much weight.”
Under the terms of the settlement, Michelin has agreed to possess competent and reliable scientific evidence substantiating any fuel-efficiency claim regarding its tires and to make other business practice improvements regarding its advertising. Additionally, Michelin is paying the states $375,000.00. Kentucky’s share of the settlement is $22,500.