Automotive industry: will state contracts be reviewed?

March 17, 2015 15:47

The global economic crisis has hit many industries, including automotive manufacturing. Impossibility to fulfill its obligations under state contracts concluded in the second half of last year will soon become one of the main problems of specialized companies, believes the president of RUSAL Oleg Deripaska.

The fact, the price of machinery contracted earlier has grown substantially in connection with the November-December ruble devaluation and the increase in the cost of component parts. Thus, only the cost of rolled metal increased by 45% for the year. In this case, contractors are forced to supply equipment at the old price, fixed in the contract, which leads to losses. At the same time number of sales of vehicles to individuals decreases as well.

According to the published data of "AUTOSTAT", in 2014, sales of passenger cars in Russia decreased by 10% and amounted to about 2.5 million units, trucks — by 21% to 88,000 units, and buses — by 25% to 11,000 units. Manufacturers optimize production schedules adjusting to new conditions. For example, the GAS switched to work in one shift instead of three shifts.

KamAZ plant is ready for more radical measures. According to sources close to the company, it expects to begin negotiations on the revision of conditions of a number of government contracts. This was made possible due to the decision of the Government of the Russian Federation dated March 6. It contains rules for amending contracts ending in 2015, by mutual agreement. The document was prepared as part of anti-crisis program and will be valid until January 1, 2016.

Representatives of "Uraltransmash" would not refuse to revise certain state contracts. First of all, they are interested in the agreement of trams supply to the Moscow Government, made in 2013. According to a reliable source, the company has fulfilled half of his obligations under the contract and would like to reduce the amount of work remaining or to raise prices for equipment to be provided. Pursuance of contract terms in the changed economic situation leads to losses and can completely paralyze company work, says the source.

According to the estimates of relevant experts, the likelihood that the state will show understanding for the situation of automakers and will agree to review state contracts, is large enough. The main reasons for this decision will be sanctions for state purchases of foreign machinery and the need for additional preferences for domestic producers, they said.