Technical plant in Russia. Problems and perspectives

Task. Read two articles about car and truck production in Russia. What do you know about the situation in car production industry in our country? Find additional information about car producing plants in Russia. Analyze the problems in this field.

Suzuki to build manufacturing plant in Russia

The texts are taken from http://www.mnweekly.ru/business/20070517/55248254.html

Learn the following vocabulary.

To build a production facility

To expand

Annually

negotiations

to construct full-scale assembly plants

to offer significant incentives for foreign direct investment

Russia’s largest truck maker

Russia’s leading carmaker

payment problems

According to an unconfirmed report by the Japanese daily newspaper Sankei Shimbun, Suzuki is planning to build a production facility in Shushary, Leningrad region. Construction of the plant could start later this year, with production commencing in 2010. The report says the plant will initially produce 26,000 cars annually but can be expanded to 50,000. The total investment volume is estimated at $115 million. According to Global Insight, Suzuki was originally planning to jointly produce cars with Nissan, similar to a deal concluded last year in India. But negotiations collapsed and now the company might be setting up its own plant.

Building an assembly plant for 25,000 cars annually would require Suzuki to significantly increase sales, however. According to a report by the Association of European Businesses in the Russian Federation (AEB), Suzuki sold only 3,205 units of its Grand Vitara model during the first quarter of 2007. Ford tops the list, having sold 20,791 units of its highly popular Focus model during the same period.

Despite these figures, there are at least two good reasons for Suzuki to build a plant in Russia. To protect its domestic automotive industry, the Russian government is levying significant duties on auto parts. If a manufacturer sets up a plant with a minimum capacity of 25,000 units annually, duties for parts are significantly reduced.

The Russian car market is also one of the fastest growing in the world: AEB reported that during the first quarter of 2007 125,210 new foreign cars were sold in Russia, 74 percent more than during the same period in 2006. The market is expected to continue growing rapidly over the next years, reaching at least 2.3 million units by 2010.

Nissan, Toyota, and GM are currently constructing full-scale assembly plants in the Leningrad region, where the local government has been offering significant incentives for foreign direct investment.

Russia`s KamAZ cuts truck production by 61% in January-March

The text is taken from http://news.rin.ru/eng/news///12480/3/

Russia’s largest truck maker KamAZ manufactured around 5,000 vehicles in the first quarter of 2009, representing a 61% year-on-year decrease, a company spokesman said on Tuesday. In January-March 2008, the company produced around 13,000 trucks, compared to 5,150 in the same period of this year. In April, KamAZ plans to manufacture more than 2,500 vehicles, the spokesman said.

However, the company will move to a four-day week in June without introducing forced holidays, but could resume normal operations if additional orders are received.
KamAZ, based in Naberezhnye Chelny in the Volga republic of Tatarstan, restarted its main assembly line in mid-March after a 10-day break due to weak demand for vehicles amid the financial crisis.

The company has suspended production four times in the last six months, most recently putting workers on forced holidays on March 6-16. Auto factories throughout Russia have been hard-hit by rising prices for auto parts and other supplies, and declining sales.

Russia’s leading carmaker AvtoVAZ briefly shut down its assembly line twice in February, citing payment problems with suppliers. The country’s second largest producer GAZ Group, which also suspended production for two weeks in March, is facing tens of millions of dollars in debt claims from metal suppliers. A Ford factory near St. Petersburg shut down its assembly lines for about a month in December.

3. Pair work: Discuss the perspectives of car producing plants in Russia (e.g. Nissan, Toyota, etc). Make a presentation.

4. What do you know about manufacturing plants in Krasnoyarsk?

LESSON 19

PROCESS CONTROL - AN INTEGRATED APPROACH http://www.rockwellautomation.ru/applications/gs/emea/GSZA.nsf/pages/at060308

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