Tue November 1 11:30 am 2022 in category Stock exchange releases
Inside information: Nokian Tyres plc to invest in a greenfield factory in Romania, the first zero CO2 emission factory in the tire industry
Nokian Tyres plc, Inside information, November 1, 2022 at 11.30 a.m.
Nokian Tyres’ Board of Directors has made a decision to invest in a new passenger car tire factory in Romania. The new greenfield factory will be located in Oradea in the North-West of Romania, near the Hungarian border. The annual capacity of the factory will be 6 million tires with an expansion potential in the future. The site will also house a distribution facility for storage and distribution of tires. The total investment is estimated to be approximately EUR 650 million. Construction is scheduled to begin in early 2023 and the first tires are estimated to be produced in the second half of 2024. Commercial tire production is expected to start in early 2025.
“This investment is a significant strategic decision enabling our future growth. A world-class manufacturing facility in Europe is a key step in getting additional capacity and creating a balanced manufacturing platform as we start building the new Nokian Tyres without Russia,” says Jukka Moisio, President and CEO of Nokian Tyres.
The planned headcount of the Romanian factory is about 500 employees. The factory will concentrate on the production of larger rim size passenger and SUV tires that will be primarily sold in the Central European market.
“Central Europe is an important market for us, and the investment shows our commitment to the market. The new site will be strategically located close to our customers. After a thorough evaluation of over 40 locations and several factors, such as skilled workforce availability, logistical advantages and stable business environment, it was clear that Oradea was the best choice for our new factory,” says Adrian Kaczmarczyk, SVP, Supply Operations.
“We are committed to building a zero CO2 emission factory – the first in our industry. The site location in Romania supports this target as we can utilize green energy produced near the site. In addition, we are critically evaluating the production processes to find the most sustainable ways to produce tires,” Kaczmarczyk continues.
In June 2022, Nokian Tyres’ Board of Directors decided to initiate a controlled exit from Russia. Due to the war and the subsequent, tightening sanctions it is no longer feasible nor sustainable for Nokian Tyres plc to continue operations in Russia. In October, Nokian Tyres signed an agreement to sell its Russian operations. To secure supply of its products, Nokian Tyres decided earlier in the year to expedite its plans to invest in new production capacity in Europe, and the Romanian factory is a key element of these plans. In addition, Nokian Tyres continues to increase capacity at its factories in Finland and the US, aiming to become geographically more diversified in its manufacturing operations.
Jukka Moisio, President and CEO, tel. +358 10 401 7742
Adrian Kaczmarczyk, SVP, Supply Operations, tel. +49 151 6182 2476
Päivi Antola, SVP, Communications, Investor Relations and Brand, tel. +358 10 401 7327