Nokian’s Chief Executive Hille Korhonen says summer tyre inventories that are present in Central Europe were higher as compared to normal, which is influencing the distributors to pause the process of stocking winter tyres.
Nokian Tyres are one of the leading tyre manufacturers of Finland, and it builds tyres for cars, buses and trucks. The tyre maker said that the European sellers are holding back from purchasing expensive winter tyres due to extensive inventories, which is aiding in damaging its Russian market as well.
Nokian Tyres is famous for designing and building premium tyres for the ones who appreciate protection and sustainability. Chief Executive Hille Korhonen said in a statement “We expect short-term weakness in sales volume throughout Central Europe to continue during the remainder of the year.”
He said that the summer tyre inventories that are present in Central Europe were higher as compared to normal, which is influencing the distributors to pause the process of stocking winter tyres. In addition to that, the ‘tyremaker’s opinion on the market of Russia had worsened throughout the entire year.
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Talking about the numbers, the shares in Nokian were 3% more moderate in late trading. The Chief Executive of Nokian tyres also said that the process of joining oversupply was imposing influence on the prices.
“So it seems that the order intake is slower compared to many, many years and they will be ordering goods closer to the season. There is increasing uncertainty in the Russian market and my meetings with all key distributors in Russia earlier this month confirmed the weakness,” said Hille Korhonen.
Recently, the tyre maker was covered in Dow ‘Jones’ DJSI World sustainability index as the company has met its goal. The goal was to reduce the discharge of CO2 from the tyres by decreasing the rolling resistance. Korhonen said, “Our new factory in the U.S. is one more proof of our sustainability: safety in the workplace and eco-friendliness have been priorities already in the building phase.”