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Michelin and Nokian Tyres will suspend operations over supply issues
French tire manufacturer Michelin announced on Tuesday it has decided to cease its business in Russia and transfer activities to local management. The company cited supply chain problems as the main reason behind the decision.
“After suspending its manufacturing activities in Russia on March 15, Michelin now confirms that it is technically impossible to resume production, due in particular to supply issues, amid a context of general uncertainty,” a statement from Michelin reads. “The Group is therefore compelled to plan the transfer of all of its Russian operations by the end of 2022.”
The new entity would operate through an independent structure from Michelin, the company clarified.
Michelin Russia employs around 1,000 people, with an annual production capacity of up to 2 million tires at its plant near Moscow.
Another tire manufacturing company, Finland’s Nokian Tyres, announced on the same day that “due to the war in Ukraine and the subsequent, tightening sanctions it is no longer feasible nor sustainable” to continue operations in Russia.
The exit preparations will start immediately. The company will evaluate different options for the exit.
“This was not an easy decision given we have over 1,600 dedicated employees in Russia whose expertise we highly value as well as many long-standing customer and supplier relations built over the past 17 years,” Jukka Moisio, the president and CEO of Nokian Tyres, said.
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