If executives at the North American operations realize the success they are shooting for — company executives have said publicly they want to double North American sales in five years — Nokian soon could find itself swimming with the sharks.
On May 3, Nokian — ranked No. 18 in Tire Business' 2017 Global Tire Rankings with 2016 sales of $1.7 billion — took one of the first steps in growing its North American business, announcing plans to build a plant in the U.S., a $360 million, 830,000 sq.-ft. project in Dayton, Tenn.
The plant, Nokian's third worldwide, will concentrate on producing passenger, SUV and light truck tires specifically for North American consumers. It is scheduled to go on-stream in 2020 with an eventual capacity of 4 million tires per year and 400 employees.
Site preparation has begun, with site leveling set to start within 30 days. The groundbreaking ceremony is Sept. 20.
The state of Tennessee recently approved a $28.4 million grant that will go toward plant infrastructure, site development, equipment, construction and related work, according to terms of the grant. The location is large enough to accommodate a tripling of the planned facility's size.
"We have been focusing on this for a couple of years, but definitely this is a big step for us, taking us to the next level," Tommi Heinonen, head of North America, said with a smile, sitting in the conference room at the Nokian headquarters. "Having local manufacturing is a big thing."
Coming to America
Nokian had considered building a plant in Central Europe to strengthen that market, another target area for growth, but the firm's board of directors chose instead to bolster its North American presence by constructing a factory closer to the new customers it so eagerly wants to attract.