WASHINGTON – Michelin's contracts with the U.S. military should be canceled if the Greenville company's French affiliate pursues business in Iran despite international sanctions, according to three members of the House Armed Services Committee.
Michelin North America Inc. provides tires for Defense Department aircraft and vehicles, but the work would be threatened if the parent company makes business deals in Tehran before a settlement is reached to stop Iran's nuclear program, the congressmen said.
The three Republican congressmen — Reps. Doug Lamborn of Colorado, Trent Franks of Arizona and Joe Heck of Nevada — laid out their concerns in a Feb. 18 letter to Defense Secretary Chuck Hagel. The letter was sent a few days after several French corporate executives went to Tehran to discuss business opportunities. Leaders of Michelin were among the delegation, the Wall Street Journal reported last month.
The congressmen said it was "greatly troubling" that some of the companies involved did work for the U.S. military, but their letter singled out Michelin in particular.
"This French company has obtained contracts in excess of $2.4 billion since 2007 to provide equipment to all of the U.S. military services, including Army trucks and Air Force jets," according to the letter provided by Lamborn's office.
A spokesman for Michelin North America in Greenville said Monday that company officials have seen the letter but declined to comment. The company has 18 plants in North America with 22,270 employees, about 7,700 of which are in South Carolina.
Lamborn, Franks and Heck asked Hagel to inform Michelin that any business with Iran would make further contracts with the Pentagon "impossible." They also asked him to analyze how existing contracts could be canceled, and estimate the legal liability if Congress were to cut funding for ongoing contracts.
President Barack Obama and French President Francois Hollande also made comments regarding the French delegation to Iran when Hollande was in Washington Feb. 11. Economic sanctions remain in place against Iran while the international community enforces an interim nuclear deal and negotiates a final version.
"We have been extraordinarily firm that even during this interim agreement, we will fully enforce all applicable sanctions," Obama said. "And so businesses may be exploring, are there some possibilities to get in sooner rather than later if and when there is an actual agreement to be had, but I can tell you that they do so at their own peril right now because we will come down on them like a ton of bricks with respect to the sanctions that we control."
Hollande said he warned the French business executives that the economic sanctions against Iran would remain in force.
"And if contacts were to be made with a view to a new situation in Iran, a situation where Iran would have renounced the nuclear weapon fully and comprehensively — well, unless such a new situation would prevail, no commercial agreement could be signed," Hollande said during a news conference with Obama. "That's what I told French businessmen and they are very much aware of the situation."