Nokian mulling temporary layoffs as Covid-19 lowers demand

Nokia, Finland – Nokian Tyres plc has entered a two-week negotiation period with employees over possible temporary layoffs in its Finland operations amid the Covid-19 outbreak and slow demand in Europe.

Discussions, which started 18 March, concern over 1,600 people and will review layoffs of at most 90 days per employee, Nokian said in an 18 March statement. 

Government restrictions on mobility during the outbreak would affect the amount of work at certain functions, the company pointed out.

In a subsequent update, Nokian said it had introduced temporary travel bans and moved to remote-working where possible. 

In Vzevolozhsk, Russia, the tire maker will adjust production output in line with global demand, added the 23 March announcement.

In the US, the tire maker has postponed recruitment of additional employees at its recently opened Dayton factory. 

The plant, however, remains open and production ramp-up continues, Nokian added. 

In Spain, Nokian has stopped the construction work at the site of its new testing centre, in Santa Cruz De La Zarza, delaying the project launch scheduled for later this year.

Nokian went on to say that its raw material supply chain is currently not being impacted by the coronavirus outbreak. 

“So far, all our raw materials suppliers operate as normal. However, we do expect delays in transportation," the tire maker said.

The company added that it was using ‘safety stocks’ to cover any delays and lower the risk of production disruption.