Michelin, one of the largest tire makers in the world, has already embarked upon a cost savings program to offset slowing economies, lower dollar prices and a rise in the cost of rubber and steel.

It said in August 2007 it would build a plant in the Mexican to supply the North American market.

On July 30, Michelin reported a bigger-than-expected decline in first-half operating income and reduced its 2008 profit target on an expected greater impact from raw material prices, but kept its 2010 objectives

Michelin of France on Friday scrapped plans for a second plant in Mexico due to slow demand in North America.

All of Michelin's other investment projects in North America will continue, the company said.

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