Nokian, the Finnish tire maker, announced on Tuesday that it would keep production running in Russia to maintain direct control over the facility, even as many global firms halt operations in protest. The move aims to keep the factory inside Nokian’s own governance and under its supervision for the long term, a spokesperson said, emphasizing this approach ensures ongoing oversight and quality standards. The company also asserted that its products will not be used for military purposes and will remain aligned with international norms and sanctions, according to officials familiar with the matter.
Before Russia launched its special operation in Ukraine, Nokian accounted for about 80 percent of Russia’s annual tire output, roughly 20 million units. Those tires are primarily intended for passenger cars, with heavy equipment tires produced elsewhere, including Finland. This production split underscores Nokian’s broader manufacturing footprint and its reliance on geographically diverse plants to meet regional demand.
Recent reporting by Helsingin Sanomat Daily and other Finnish media suggested that a conference with a market analyst included remarks about potentially gaining market share as competitors such as Michelin, Continental, and Bridgestone either reduced activity in Russia or exited the market altogether, including Pirelli. Shares of Nokian dropped sharply following the coverage, reflecting investor sensitivity to perceptions about strategic moves in a sanctioned market. Nokian’s leadership later addressed the reports, stressing that the remarks were taken out of context and that the focus is not expansion at any cost but maintaining control to prevent the assets from slipping into the wrong hands and being used for military purposes.
According to Nokian, keeping the factory under its own control is about safeguarding the integrity of the production and supply chain, rather than pursuing aggressive growth. The company indicated that the priority is to avoid situations where the facility could be misused or managed by third parties whose intentions do not align with Nokian’s standards and legal obligations. The firm also noted that it would not invest further in the Russian plant in the near term, choosing instead to explore increasing capacity at plants in Finland and the United States, while considering additional opportunities in other regions. This approach reflects a broader strategy to diversify manufacturing, reduce exposure to sanctions risk, and strengthen supply chains in core markets.
Industry observers say the sanctions environment has intensified scrutiny of foreign assets in Russia, with authorities reportedly weighing steps to nationalize assets belonging to firms that decided to exit or suspend operations. Nokian’s stance remains focused on preserving the continuity of its tire production while staying within the regulatory framework and maintaining assurances that its products are not directed toward military use. The company also affirmed its commitment to monitor the geopolitical situation and adjust plans quickly if needed, a signal to investors that it remains vigilant about potential shifts in policy or market access.
In Russia the Vsevolozhsk plant, which began operations in 2005, continues to manufacture passenger car tires for local consumption. Nokian’s broader plan includes accelerating output growth at sites outside Russia to ensure a balanced global footprint and to mitigate risk associated with any single market. The company emphasized that product quality and safety remain a top priority, reinforcing its intent to uphold international standards and customer expectations while navigating a complex sanctions landscape and fluctuating demand. Overall, Nokian positions itself as a cautionary but proactive player in a difficult regional market, balancing the need to maintain control of essential assets with a strategy focused on core production hubs elsewhere.