Nokian Tires will not build a copy of the Russian plant after leaving the country
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The Finnish concern Nokian Tires does not plan to recreate a plant in Romania similar to the enterprise in Russia, which produced 80% of its products. About this CEO Jukka Moisio told in an interview with The New York Times.
“Nokian is not going to copy the megafactories in Romania like they are in Russia or anywhere else, for that matter. The idea of concentrating production is “outdated,” the CEO stressed.
Nokian Tires has chosen the city of Oradea in Romania to build a new plant in Europe for 650 million euros after it decided to sell its business in Russia – a tire plant in Vsevolozhsk, Leningrad region. The site was chosen taking into account “geopolitical risks”. Options for locating production in Poland, Hungary, Serbia were considered, but the governments of these countries were considered “anti-democratic,” Moisio said in an interview. Low labor costs and a more acceptable level of risk played in favor of Romania.
Moisio also noted that the company will not place 80% of production in one place in the future, but will disperse this volume across different regions. He clarified that tires for the Northern European market will be produced in Finland, for American consumers in the US, and tires for the European market will be supplied from the future “European plant”.
The Finnish tire manufacturer Nokian Tires has been operating in Russia since 2005. In 2021, about 80% of the company’s passenger car tires were produced in Russia, the press service of Nokian Tires specified earlier. At the same time, the share of sales of the company’s products in Russia and Asia was about 20%. In June 2022, the company announced its withdrawal from the Russian market after the imposition of sanctions on the import of Russian tires into the EU.
In March, the Russian oil companyTatneft» became the owner of 100% of the authorized capital of the tire plant in Vsevolozhsk. The companies signed an agreement on the deal at the end of October 2022. Then the Finnish company noted that the deal would amount to about 400 million euros. In March Nokian Tires reportedwhich received 285 million euros for the Russian tire business from Tatneft.
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