These are murky waters.
Rostechnology tends to chill the spine somewhat; it is, in the Scorsesean argot, a company that gives the appearance of being if not made then certainly connected. AvtoVAZ's President has indicated that he is to step down, and we are given to wonder quite where all of this is heading.
Such a merger would put Daimler very much into the category of junior partner, if not incidental shareholder. Its ten per cent of KamAZ - acquired last December - has been described as a placeholder, and, presumably, Stuttgart must be watching events in Moscow with some trepidation. Whilst Daimler is pushing commons projects with KamAZ pretty hard at present, we're not entirely convinced that this is going to end happily. Rostechnology has the appearance of being both a state controlled and a state directed operation, and a junior, technology-rich partner would be entirely justified in feeling uncomfortable in such an arrangement.
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Benz and KamAZ certainly do not share common agendas or motivations. KamAZ has consistently promoted their own engines to Avtodizel, so its unclear if the merger would promote the use of Avtodizel's license-built 311 to 412hp Renault dCi engines in Kamaz trucks. Kamaz has stroked their 11.76L 740 series engine to 12.3L (from 120x130mm to 120x136mm) and announced a 460hp Euro-4, but the old dCi is probably superior in every respect. Combining two truck related companies with a car company makes no sense as no synergies are present, which Scania and Saab discovered when they tried it.
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State-owned Russian Technologies Corp. plans to create a large holding company that will merge AvtoVAZ (Russia’s largest carmaker) with heavy truck maker KamAZ and diesel engine maker Avtodizel (Auto Diesel).
Russian Technologies Corporation (Rostechnology), a state holding company which includes construction, aviation, defense, biotechnology and car manufacturing holdings, owns a 37.8% stake in Kamaz.
Russian Technologies will consolidate its stakes in KamAZ, AvtoVAZ and Avtodizel into a holding company called “Rosavto”.
Sergei Kogogin, the general director of KamAZ, will head the new company.
Sergei Chemizov, the head of Russian Technologies, would be the new company's CEO.
The merger would give Rosavto a 25% stake in AvtoVAZ, 37.8% of KamAZ and 30% of Avtodizel (Avtodizel is part of billionaire Oleg Deripaska's GAZ Group).
Renault owns 25% of AvtoVAZ.
Daimler owns 10% of KamAZ.
As Russia’s economy continues to slow down, both AvtoVAZ and KamAZ have suspended production in recent weeks.
AvtoVAZ, Russia’s largest automaker, faces a production crisis resulting from mounting debts and the threat of severe employee cuts that could lead to social unrest in Russia’s Togliatti region. AvtoVAZ sales fell 44% in the first half of 2009. Production fell 63.7%. Revenues fell 50% to US$1.3 billion in the first half of 2009 compared to $2.6 billion last year. In the first half of 2009, AvtoVAZ posted a US$446 million loss against a profit of US$47 million last year. AvtoVAZ’s debt to banks rose 33.5% to US$1.7 billion. Debts to parts suppliers rose 38.8% to US$1.1 billion. The US$790 million in interest-free loans AvtoVAZ received from the Russian government in the second quarter will run out in August.
KamAZ’s market share increased in the first half of 2009, helped by the devaluation of the ruble and an increase in government truck orders. As a result of last year's import tax increase on foreign-made trucks (from 10% to 25%), the market share for imported trucks fell to 21.1% from 51.3% a year earlier. KamAZ benefitted from the sharp drop in imported truck sales. KamAZ’s market share in June rose to 58.5%, from just 28.2% in December. But KamAZ truck sales fell 57.4% to 4,384 units in the first 6 months of 2009.
GAZ Group’s Avtodizel plant (Yaroslavl Motor Works - YaMZ) produces truck engines and transmissions for MAZ (Belarus), Kamaz and Ural (Russia), and AutoKrAZ (Ukraine) including 311 to 412hp Renault 11-liter dCi engines (renamed YaMZ-650) under license.
Posted by Kevin Scarbel | August 28, 2009 6:34 AM
Posted on August 28, 2009 06:34