MOSCOW, June 29. /TASS/. The division of Nokian Tyres in Russia will continue to operate, the plant in Vsevolozhsk will maintain the production, the company said in a statement on Wednesday.
However, the company noted that the final decision on the mechanism of further operation has not yet been made, negotiations with the parent company will be completed during the third quarter of this year.
Andrey Pantyukhov, General Director of Nokian Tyres in Russia, noted that "the sanctions restrictions adopted by the EU made it impossible for us to continue working in Russia as part of the Nokian Tyres concern."
"The management of the Russian company Nokian Tyres prepared and submitted a proposal on the future format of the company's operation in Russia in an autonomous mode to the board of directors of the concern," he added.
"We believe that the approval of this proposal will allow us to continue operating in Russia. However, the Board of Directors needs more time to make a decision. Also, the Board of Directors may consider other potential decisions as part of a controlled exit from the market. In any case, the goal is to implement the decision, which will ensure the continuation of the company's sustainable activities in Russia," Pantyukhov said.
He added that the company will continue its work in Russia, including the production of tires at the Vsevolozhsk plant, and does not plan further layoffs, despite the decrease in the production of the plant, whose products were mainly exported.
"Meanwhile, Nokian Tyres in Russia will continue its work, including production at the plant in Vsevolozhsk, and will fully fulfill all its obligations to employees, customers, consumers, suppliers, other partners and tax authorities," Pantykhov said.
He explained that after the EU introduced fifth package of sanctions the company will no longer be able to export tires manufactured at the the Nokian Tires plant in Vsevolozhsk after July 11.
"There will be a significant decrease in production of the Russian plant. The company does not plan to further reduce the number of personnel in Russia. Currently, we are working on how to provide the plant with raw materials amid sanctions restrictions to continue operating activities," Pantyukhov said.
On Tuesday, Nokian Tyres announced on its website that it has decided to initiate a controlled exit from the Russian market due to the situation in Ukraine.
The company stressed that this process will be done with due consideration to local employees and legislation. The Finnish tire maker notified the authorities of Russia’s Leningrad region that it will lay off over 300 employees of its local plant in July.
Also on Tuesday, the French tire manufacturer Michelin announced that it would cease operations in Russia by the end of 2022 and transfer the Russian division to local management.