Nokian says Ukraine war impacting logistics, lead times to customers
9 Mar 2022
Tire maker activates contingency plan, transferring production to Finland, US
Nokia, Finland – Nokian Tyres has seen its Russian operations impacted by transportation capacity availability, and lead-times to customers have increased.
In an update 8 March, the Finnish tire maker said its crisis management team meets daily, and the company is "prepared for different scenarios."
“We have activated our contingency plans to mitigate the financial and operational impacts to our business,” it said.
For example, Nokian went on to say, the company is shipping tires closer to customers, securing the raw material supply to factories as well as transferring production of selected key product lines from Russia to Finland and to the US.
The tire maker is also trying to secure transport capacity from Russia with existing and new service providers.
As a result of the disruptions, the tire manufacturer said it will continue to increase production in Finland and in the US.
All Nokian’s heavy tires are designed and manufactured in Finland, while truck & bus tires are designed in Finland and produced in the EU.
In addition to the logistical woes, Nokain warned that its operations could be further impacted by raw material supply as well as increasing sanctions on Russian companies and banks.
“Our compliance with current sanctions requires that some of our customers and suppliers in Russia need to change their bank,” the company added.
In cross-border transactions, it noted, "there are delays and volume is small, as the currency trading is not working normally."
Nokian has been operating in Ukraine since 2006, and has 20 employees in the country.
The tire maker said it had donated €100,000 to UNICEF to help the children in the war zone in Ukraine.