Uralvagonzavod heading for the USA
A foreign strategic partner of the state "Uralvagonzavod" can become an American Caterpillar. Companies want to produce high-power engines, road-building equipment and develop the car-repair business. Production will be launched at the facilities of the Chelyabinsk plant ChTZ-Uraltrak, in which Uralvagonzavod plans to invest 13 billion rubles. From Caterpillar, Russian partners are waiting primarily for technology and new developments.
Oleg Sienko, general director of Uralvagonzavod, told Kommersant that the company had chosen a key partner in developing the production of engines, road-building equipment and car repair - this is American Caterpillar. According to the top manager, “as one of the options”, the creation of a joint venture is considered. More detailed schemes of cooperation are developed by a specially created working group. In particular, "the way the partnership will be legally formalized is now being discussed, so far there is no definitive answer, whether it will be a joint venture or production under license". The volume of investments in joint projects has not yet been finally determined. At the weekend, Caterpillar didn’t respond to the inquiry “Ъ”.
Caterpillar produces a wide range of road-building equipment from tractors to mining trucks, as well as diesel engines and power equipment. The company's net profit in 2010 was $ 2,7 billion, revenue was $ 42,6 billion. The company opened a plant in Russia (in Tosno Leningrad Oblast) in 2000, but it mainly produced components for assembly plants in Eastern Europe. Only in 2010-m the production of heavy-duty excavators began at the plant, the production volume at the first stage was planned at the level of 1,5 thousand machines per year.
Engines and road construction equipment of the company will be produced at the facilities of Chelyabinsk ChTZ-Uraltrak, 80% of shares of which belong to Uralvagonzavod. "The partnership with Caterpillar will be developed primarily in the field of diesel engines with a capacity of up to 4 thousand horsepower, which are installed on ships, locomotives, mining dump trucks and other heavy road-building equipment," explained ChTZ-Uraltrak CEO Semen Mlodik. “We hope that production will start in the 2012 year, in the future we expect to reach the localization level in 70% -80%." According to the top manager, production will not exceed 1 thousand engines per year, because the cost of these products is high - the price of a single high-powered engine can reach $ 100 thousand. At the same time, ChTZ-Uraltrak will continue to independently develop and produce its own engines. 100 to 2,5 thousand horsepower, emphasizes Simon Mlodik.
“Another segment where we look at cooperation with Caterpillar as a world leader is the production of pipe-laying machines,” adds Oleg Sienko. According to Semen Mlodik, production can also be launched from the 2012 year and "further expand to another road-building equipment." Now ChTZ-Uraltrak produces two models of medium-capacity pipe-laying machines (the maximum carrying capacity is 27-41 t), but it expects to expand the model range through the development of an American company. Caterpillar offers on the Russian market four models of high and medium capacity pipe layers with a maximum carrying capacity of 18-91 t.
In addition, according to Mr. Sienko, Uralvagonzavod, which is the largest car manufacturer in Russia, is planning a partnership in the car-repair business with its subsidiary Caterpillar Progress Rail Services Corporation. Progress Rail provides wagon maintenance services mainly in the USA, as well as in Canada, Mexico, Brazil, Italy, Germany and the UK. "They have a good tradition and technology to support the entire life cycle of the car and repair it, it attracts us," said Oleg Sienko. According to the top manager, the plant wants to concentrate on car repair and production of spare parts for railcars, because in the coming years, due to the glut of the market, sales of new railcars will stabilize and even decline. "Progress Rail has great competencies in the car-repair industry and can provide its technologies," adds Semyon Mlodik. The management of "Uralvagonzavod" expects that the partnership with the American company will allow to modernize the "CTZ-Uraltrak". In the spring, the plant announced a program of technical re-equipment of the plant for 13 billion rubles. The investment program will be financed from funds "allocated within the framework of the Federal Target Program" Development of the RF Defense-Industrial Complex for the 2011-2020 Years ", as well as from the funds of the corporation and the funds raised." Now Oleg Sienko told Kommersant: "If we have the opportunity to not fully invest money in modernization, but to attract part of these funds at the expense of our partners, who will give us technologies and new developments, then we will go this way or jointly invest in the development of new products ".
VTB Capital's Vladimir Bespalov notes that now "in Russia, the competence in the production of high-powered engines is small, it is a niche and highly demanded product," so Uralvagonzavod and Caterpillar can count on "stable orders and purchases." “The demand for pipe-laying machines should also be now, as gas pipeline construction projects are actively developing,” the expert believes. He believes that under the Caterpillar brand, Uralvagonzavod can count on large orders. But, the analyst adds, the American company "is unlikely to invest money in the modernization of ChTZ-Uraltrak". As in the case of AvtoVAZ and the Renault-Nissan alliance, explains Vladimir Bespalov, most likely it will be the contribution of technology and equipment.
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