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June 02, 2004 02:00 AM

Nokian starts work on Russian tire plant

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    NOKIA, Finland (June 2)—Nokian Tyres P.L.C. has broken ground in Vsevolozhsk, Russia, on a tire plant it expects will be producing tires by next year.

    Nokian has budgeted $63.5 million for the factory near St. Petersburg, Russia, which will have a startup annual capacity of 1.5 million passenger tires by 2006. The initial construction phase will yield a facility spanning 226,000 square feet, sufficient to accommodate a capacity of 4 million tires annually, Nokian said. Capacity will be expanded gradually, eventually reaching 8 million units by 2016.

    The plant is designed to be as automated as possible as well as have minimal environmental impact, Nokian said. It will make Nokian-branded passenger car tires, which will be sold primarily in the growing Russian market. In the initial phase, the facility will employ about 200, most of whom will be Russian.

    Nokian chose Lemcon Ltd., a subsidiary of Lemminkainen Group, to build the plant. The cost of construction will be nearly $26 million.

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