Did you see Nokia's tires? Nokia's new factory laid a foundation to countdown

Almost no one knows Nokia mobile phones, but Nokia tires are a bit low-key. Just as its North American headquarters is very low-key, this is also in line with Nokia's current position in the North American market. Nokia Tire is like a small fish in the ocean of tires. In North America, there is less than 1% of the market share, mainly in winter tires and ultra-high performance tires to fight the world. In contrast, in the Nordic market, Finland, Sweden and Norway, Nokia is firmly in the dominant position, with brand awareness exceeding 80%.

Nokia North American business executives have publicly stated that Nokia tire sales will double in the North American market in the next five years. If this goal is reached, Nokia will find itself “swimming with sharks”.

In 2016, Nokia Tire had sales of US$1.7 billion, ranking 18th in a media's global tire ranking. In May of this year, Nokia Tire announced plans to establish a new factory in the United States and take the first step to expand the North American market.

The new plant plans to invest US$360 million in an area of ​​830,000 square feet. The factory is located in Tennessee and site preparation has begun. It is expected that the foundation laying ceremony will be held on September 20. The plant is scheduled to be put into operation in 2020 with a design capacity of 4 million tires/year and employs approximately 400 people. After the factory is completed, it will become Nokia's third global factory, mainly producing passenger cars, SUVs and light truck tires, mainly serving consumers in North America.

The State of Tennessee recently approved a grant of up to $28.4 million, which will be used for infrastructure construction, site development, equipment, construction, and other related work, according to the requirements. The final plant size will probably be double the plan.

Nokia Tire had considered building a tire factory in central Europe to strengthen the European market, but in the end the board of directors decided to build a plant in North America to consolidate the North American market position. The new plant can not only provide storage for 600,000 tires, but also better solve the problem of high logistics costs. In the past, Nokia tires in the North American market came from Europe. The logistics cost was very high and the problem of having a US factory was solved. Logistics considerations are also one of the important reasons for Nokia's construction in the United States.

Tommi Heinonen, Nokia’s North American boss, expressed with confidence that Nokia’s North American market’s goal is more than doubled. The company needs to expand its distribution capabilities, increase its product lineup, and continue to strengthen its brand awareness in North America. The Nokia Winter Tire brand name in Canada is very high. But there are no shortcuts to the road to success that can only be redoubled.

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