Nokian Tyres’ mid-term growth strategy
target to reach EUR 2 billion in net sales
Nokian Tyres aims for organic growth ahead of the market, and increasing market share in all key markets.
Updated mid-term financial targets (Published in September 2021):
- Growing faster than the market: Net sales EUR 2 billion
- High returns and profitability: Segments operating profit and segments ROCE at the level of 20%*
- Growing ordinary dividend: Dividend above 50% of net earnings
“Our large investment phase is completed, and we are well positioned for organic growth and strong performance. With our current manufacturing capacity, a valued brand and a world-class team, we are now ready to take an ambitious leap forward to become a EUR 2 billion revenue company. We will continue to improve operational and commercial performance, which, together with the growing markets, will propel our company to the next level in the years ahead”, says Jukka Moisio, Nokian Tyres’ President and CEO.
Growth will be driven by new products and smart Go-To-Market strategies
The global tire market is expected to grow by approximately 5% annually by 2024 (source: LMC Tyre & Rubber). Nokian Tyres’ mid-term ambition is to exceed the market growth and reach EUR 2 billion in net sales. Macro trends, such as an increasing number of new car models, rising SUV and CUV penetration and climate change mitigation, are driving demand for sustainably produced, innovative tires.
The mid-term growth strategy builds on Nokian Tyres’ competitive strengths, including high-quality products and a premium brand, effective supply chain, leadership in sustainability and a strong Nokian Tyres team. The company has launched a record number of new products in 2020–2021 and will continue to accelerate innovation to further strengthen its competitiveness and unique positioning in the premium tire segment. This expanding product offering, together with smarter Go-To-Market strategies and improving commercial capabilities, will drive top-line growth. Reinforcing Nokian Tyres’ brand in the regions will be a key element in closer collaboration with customers. Profitability improvement will be driven by increasing volumes and operational efficiency.
New non-financial targets set the bar higher
As a frontrunner in sustainability, Nokian Tyres has set the bar even higher by introducing new, ambitious non-financial targets and embedding them throughout the core operations.
Non-financial targets focus on bringing new environmental and safety innovations to products, reducing CO₂ emissions in line with the Science Based Targets, further improving workplace safety, and monitoring the sustainability of suppliers.
Nokian Tyres will, for example:
- Increase the share of either recycled or renewable raw materials in tires to 50% by 2030
- Reduce CO₂ emissions from both raw materials and tires by 25% between 2018–2030
- Decrease accident frequency (LTIF) yearly by 20%
- Sustainability audit 100% of critical active suppliers by 2025
All non-financial targets can be found here.
Nokian Tyres was the first in the tire industry to receive official approval for its climate targets from the Science Based Targets initiative (SBT) and has been included in the Dow Jones Sustainability Index for four consecutive years, ranking it among the most sustainable publicly traded companies in the world.
Along with the revised growth strategy, Nokian Tyres has defined its purpose, which is to empower the world to drive smarter. The company has for decades safeguarded people’s lives and is committed to continuing this effort through even safer, smarter and more sustainable driving.