Nokian Heavy Tyres develops and manufactures special tyres for the heavy industry. In 2017, the business unit improved sales and profit with support from new product innovations and positive market development.
In 2017, demand for heavy special tyres grew globally. In the Western markets, the demand was good in most of Nokian Heavy Tyres’ core product groups: forestry tyres, agricultural tyres, machine tyres, harbor tyres, and mining tyres. The net sales of Nokian Heavy Tyres grew by 11% year-over-year. The operating profit, production volumes and productivity also improved.
Demand for OEM forestry tyres remained strong and was supported by the strong growth of the forestry industry. Globally, Nokian Heavy Tyres is the leading manufacturer of CTL forestry tyres and it also retained its stable position in 2017. The company expects the forestry sector to continue growing in 2018.
Demand for agricultural tyres grew especially in Europe and North America. Nokian Heavy Tyres invested in product development and introduced several tyres suited for heavy agricultural and earthmoving applications. Demand for premium truck tyres remained stable in Europe and the Nordic countries but decreased in Russia.
The company eliminated production bottlenecks by increasing production capacity at the Nokia factory and investing in production automation. The additional capacity will be fully commissioned in early 2018, providing a strong foundation for Heavy Tyres’ continued business growth in 2018.
In December, Nokian Heavy Tyres announced a new investment plan, amounting to approximately EUR 70 million, which will increase the capacity of the Nokia factory by 50% within the next three years. With the additional capacity, we especially intend to meet the demand for agricultural and forestry tyres. At the same time, an agreement was signed to encourage employee multi-skilling in order to increase flexibility.Systematic efforts to improve safety created visible results. Last year, Nokian Heavy Tyres was able to reduce accidents leading to absence at the Nokia factory by 80%.
Raw material costs increased in 2017. Nokian Heavy Tyres countered the challenging situation by implementing price increases and introducing several new products. The sales of new products developed well and increased the net sales for the full year. The average selling price increased slightly year-over-year, mainly due to the price increases and improved product selection.
Nokian Heavy Tyres continued working in close cooperation with machine manufacturers and other partners in order to improve the functionality and safety of their equipment. Product safety and sustainability have become even more important factors in product development. As a profitable and strong global manufacturer, Nokian Heavy Tyres can quickly react to the changing needs of its customers and develop its operations in a sustainable manner.