Production Underway at Krasnoyarsk Tire Plant

Production at the former Amtel-Vredestein Krasnoyarsk Tire Plant was re-launched on 19 April, with local government officials optimistic they can overcome the facility’s past problems.

Lev Kuznetsov, the first deputy-governor of Krasnoyarsk territory, has now signed a social and economic cooperation between the Administration Council of Krasnoyarsk Territory and LLC Vostokshinainvest, the owner of Krasnoyarsk Tire Plant.

The news follows the announcement that Lev Kuznetsov, the head of LLC Vostokshinainvest, director general of CJSC Krasny Yar-Shina, and director general of LLC Krasnoyarsk Tire Plant would meet to discuss the documents.

The deal that saw the Krasnoyarsk Tire Plant change ownership was completed in February. Amtel-Vredestein Group sold 100 per cent of the shares of Krasnoyarsk company Vostokshinainvest. According to reports modernisation of production will last for about two years, according to the forecasts.

Vostokshinainvest decided to launch production of large and speciality tyres, in demand form the Ministry for Defence, Federal Defence Export Service and military defence enterprises increased in 2006, at Krasnoyarsk Tire Plant. This means initial job cuts of 1,474 have now been reduced to 855.

After the startup completion, the Krasnoyarsk Tire Plant is planning to cooperate mostly with holdings. Negotiations are currently underway with GMK Norilsk Nickel OJSC, ALROSA and SUEK. This announcement was made by the Krasnoyarsk Krai’s Vice Governor Vitaly Bobrov during his visit to the tyre plant.

In cooperation with the regional government Vostokshinainvest Ltd, the territorial administration conducted negotiations with GMK Norilsk Nickel on the supply of tyres for BelAZ during the summer. Additional negotiations are currently underway with ALROSA and SUEK companies. These companies all require the large dump-truck type tyres the Krasnoyarsk plans to produce.

The value of Krasnoyarsk Tire Plant production is expected to amount to 75 million rubles (£1.5 million) by May 2006 (less than a month from the start of production). Startup of the tyre plant and conversion to the full production cycle is expected to cost about 60 million rubles (£1.2 million).