Will Nokian have the capacity to produce at least 3 new tire lines?

Bob Ulrich
Posted on March 12, 2013

In the United States, Finland is perhaps best known as the home of Nokian tires.

Sure, some of us remember that Finland finished second to the U.S. hockey team in the 1980 Winter Olympics (the U.S. beat Russia in the semi-finals). And you race fans may know that three Finns have won the Formula One championship: Keke Rosberg in 1982, Mika Häkkinen in 1998 and 1999, and Kimi Räikkönen in 2007.

But Nokian tire sales have grown rapidly in the last nine years without advertising. In 2003, Nokian Tyres plc sold close to 35 million euros worth of tires in the U.S. and Canada. In 2012, that number grew to 112.2 million euros ($148.3 million).

Not surprisingly, the company is known most for its winter tires. Nokian invented the winter tire in 1932.

Nokian invited its largest dealers to Ivalo, Finland, to introduce three of its latest tires. They are the Hakkapeliitta R2, the Hakkapeliitta R2 SUV and the WR G3.

The dealers put the next generation tires to the test on March 12, 2013, at the Nokian test track in Ivalo, which is located 200 miles north of the Arctic Circle. I was on hand and will pass along the results when the tests are completed.

I can tell you that the new Hakkapeliitta lines feature not only the Rubber Manufacturers Association's severe service emblem (a snow flake on a mountain peak), but also "extremely low rolling resistance," according to Nokian.

The WR G3 line is closer to an all-season touring tire, but also features the mountain snowflake.

Does Nokian have the capacity to produce these tires? Yes. Its plant in Nokia, Finland, can produce six million consumer tires annually. Its newest plant in St. Petersburg, Russia, can produce 15 million tires annually.

"We are ready to expand the Russian capacity to 20 million or more rather rapidly," said Hannu Teininen, vice president of sales and logistics. He added that the site for a third plant, located somewhere in Europe (but not Finland), will be built "whenever it is needed." When the ground on the new plant is broken, it will take almost two years before it is up and running.

The dealers have told me that fill rates for Nokian tires, including non-winter tires like the enTyre and Rotiiva, have not been a problem.

Since Nokian's plants are running at 70% capacity due to soft global demand, I would say capacity is not a problem.

Nokian Tyres North America President and General Manager Tommi Heinonen says dealers can order the four new lines now, "just" in time for the 2013-2014 winter season.

And for those of you who are looking for the next generation WR G3 SUV and/or Hakkapeliitta 7, you will have to wait. The WR G3 SUV and Hakkapeliitta 8, which recently were introduced in Europe, won't be available until next year.

Related Topics: Hannu Teininen, Nokian Hakkapeliitta, Nokian WR G, RMA, Tommi Heinonen, winter tires

Bob Ulrich Editor
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