NOKIAN TYRES SUSTAINABLE MANUFACTURING ROMANIA

Promoter – Financial Intermediary

NOKIAN RENKAAT OYJ

Location

• Romania

Description

The project concerns the Promoter's investments in the construction and ramp-up of a manufacturing facility deploying advanced manufacturing technologies to produce passenger car tyres. The investments will be carried out in Romania over the period between 2023 and 2027.

Additionality and Impact

The Project consists of the Promoter's investment in the construction and ramp-up of a greenfield manufacturing plant to produce tyres for the European market primarily in the replacement tyres sub-segment. It represents an important industrial re-shoring of a key part of the European automotive supply chain, and, as such will strengthen the resilience of the European automotive supply chain and contributing to the EU strategic autonomy in this sector.

The Project's activities are in line with the Bank's IDHC (Innovation, Digital and Human Capital) public policy goal; as the investments takes place in a less developed region in Romania, it also supports the Bank's economic and social cohesion cross-cutting objective.

The Project contributes in full to the Bank's Climate Action and Environmental Sustainability (CA&ES) objective; it is also aligned with the Climate Bank Roadmap and, as such, with the principles outlined in the Paris Agreement.

The financing of this Project supports advanced manufacturing that generates significant positive knowledge, technology, and environmental externalities. The Promoter is a recognised player in tire industry. It has a proven record of accomplishment of similar industrial undertakings, excellent industrialisation capabilities, an experienced management and in-depth understanding of its customers' needs.

The Project integrates positive environmental and social dimensions, contributes to addressing and mitigating market failures, and through its additionality, contributes to the Bank's policy objectives.

The proposed loan will diversify Nokian Tyres financing sources and extend the debt maturity profile, which will improve the overall financing position of the company. The EIB loan's long tenor is highly valuable to the company in financing assets with long economic life. The EIB loan supports the company's investment in capacity replacement within the EU and investment in sustainable tire manufacturing.

Objectives

The Project aims at installing and ramping up yearly production capacity for some 6 million passenger car's tyres to serve primarily the Central European market. The Project represents a fundamental investment for the Promoter to support its global strategy to reach an installed manufacturing capacity of some 15 million tyres.

Sector(s)

• Industry - Manufacturing

Proposed EIB finance (Approximate amount)

EUR 150 million

Total cost (Approximate amount)

EUR 650 million

Environmental aspects

The project's activities are listed in the Annex II of the EIA Directive 2011/92/EU amended by the Directive 2014/52/EU as they concern "Manufacture and treatment of elastomer-based products". Moreover, the project entails the construction of a greenfield, large industrial estate which qualifies as "Urban development" as per the same Annex II. The decision of the local environmental authorities in relation to the environmental impact assessment as well as the other environmental details will be verified during the project appraisal.

Procurement

The Promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if at the project appraisal, the EIB were to conclude that the Promoter is subject to the EU public procurement legislation then the Bank would duly inform the Commission Services and would require the Promoter to apply those rules.

Status

Signed - 31/07/2024