NOKIA, Finland (Oct. 10, 2014) — Nokian Tyres P.L.C. is cutting back production and staffing levels on a temporary basis at its headquarters factory in Nokia to reflect market conditions, which have been impacted by a business downturn in key Russian markets.
The move follows the completion of statutory negotiations with employees at the Finnish plant, Nokian said. Workers and staff in car tire production, maintenance and quality departments at the facility are affected.
Adjustments to capacity utilization as well as cost savings will be achieved mainly with temporary lay-offs and transfers to new positions, according to the tire maker. Car tire production will be cut through temporary lay-offs by not more than 21 production days during 2014, and by a maximum of 38 production days in 2015.
Reporting significant declines in first-half sales and earnings two months ago, Kim Gran, Nokian's president and CEO, said: “Markets in Russia and CIS (Commonwealth of Independent States) proved to be more challenging than estimated as a result of the Russia/Ukraine crisis escalating, devaluations and slow economies with a clear drop in sales value as a consequence.”
Overall, around 570 workers and staff are involved in the car tire production operation at Nokian Tyres' factory.