The content of the article:
- Cars ZAZ - closed
- Government plans
- Will there be cars?
- "EuroCar" - Skoda does not save
- Experts advise
"Remember, gentlemen, corruption will ruin this country." The famous dialogue from the movie "The Man from the Boulevard des Capucines" is very fond of citing all Ukrainian officials, from the minister to the employee of the passport office.
And it is completely unclear what they mean by this - either they justify their unwillingness to work, or they state the fact that the position should bring profit to the official.
This state of affairs has long become familiar to the citizens of the country, but it still cannot be understood by foreign partners who, 10 years ago, enthusiastically decided to invest in the automotive industry. So what hinders the development of the Ukrainian car industry today, and what positions does the industry occupy?
Cars ZAZ - closed
The last passenger car rolled off the assembly line of the Zaporozhye Automobile Building Plant at the end of 2017, only one car was built in 2018, in 2019 ZAZ left the Ukrainian market, having received claims from Factoring Finance LLC in the amount of UAH 3.16 million.
On January 21, the court approved the register of creditors who demanded a refund from ZAZ. The largest creditor was the Universum Finance company, which demanded the return of no less than 2.47 billion UAH.
On March 11, the Zaporizhzhya court ruled on the reorganization of JSC ZAZ; to overcome the crisis, they proposed a six-month plan for re-profiling of production, which will help the company continue to produce cars.
But there will be no more cars at the plant. What is the reason that AvtoZAZ, the only plant in the country with a full production cycle and its own body painting shop, has left the market?
For the press and in official documents, everything sounds very confident and solid:
- Fall of the domestic car market.
- Loss of foreign sales markets.
- Aggressive market environment.
- Devaluation of the hryvnia.
Ordinary Ukrainians do not understand what the “fall of the domestic car market” means, if, according to the data of the Ukrainian Automobile Industry, sales of new cars in the country are growing from year to year.
This means that AvtoZAZ products do not correspond to such parameters as price and quality. Over the past ten years, ZAZ has not learned how to produce really high-quality cars that could, for example, compete with Romanian Renault in the budget segment.
The loss of foreign sales markets is one of the main factors that led ZAZ to bankruptcy.
The CIS market is closed for objective reasons that are known to everyone, it is not just difficult to compete with Europe, but today it is impossible.
Thanks to trade agreements with the EU, you can import any garbage into Ukraine, and sell your products on the European market - alas, there are strict restrictions. The Eurozone strictly monitors trade security and supports its manufacturer.
Ukrainian cars, even if they are of gold quality (everyone knows that we build excellently for export), are not needed in the European market.
Decrease in the hryvnia exchange rate. Due to the devaluation of the national currency, the plant was unable to pay off creditors on time, and as a result - debt, court, bankruptcy.
Government plans
AvtoZAZ's plans to get out of the crisis are designed for 6 months and look quite promising on paper.
A program for attracting new partners is planned and is already being partially implemented. The first was the Belarusian concern MAZ. In Zaporozhye, they want to launch a workshop for SKD truck assembly. The Belarusians will supply the main components and assemblies, some of the parts will be produced directly at the plant.
The experience of the largest Ukrainian manufacturer of dump trucks, the Kremenchug plant, which has been assembling MAZs in its workshops for many years, was taken as a basis.
In addition to KrAZ, the Bogdan plant cooperates with the Belarusian automaker, which assembles low-tonnage trucks and special equipment in its workshops.
The second direction is the start of production of Chinese electric buses Skywell. This information has not yet received official confirmation - the process is at the stage of negotiations. A representative of Skywell Ukraine has been working in Ukraine since May 28.
Will there be cars?
In the photo: ZAZ Vida
Until 2012, cars were built at the Zaporozhye Automobile Plant for General Motors Corporation, which sold them under the Chevrolet brand. The second partner of ZAZ was the Chinese company Chery, for which cars were built according to the same principle.
The reason for the termination of cooperation, according to Oleg Omelnitsky, general director of the information and analytical group "Autoconsulting", is the ill-considered policy of the management of the Zaporozhye plant.
It is possible and correct to use the medical term "sanitation" in the industrial sector, which means therapeutic and prophylactic measures to restore the body, but whether the rehabilitation of ZAZ will help or if drastic measures are required, we will see by the end of the year.
"EuroCar" - Skoda does not save
By 2018, the EuroCar car assembly plant, built in 2001 in the Transcarpathian region, became the only enterprise in Ukraine for the production of passenger cars.
A small enterprise located 2 kilometers from the border with Slovakia and Hungary and assembles Skoda cars. The pace of production at EuroCar has been stable over the past 18 years, but in 2019 the crisis came here as well - there is a slight, but a decrease in production.
The Skoda company plans to continue cooperation with the leadership of the Transcarpathian enterprise, but refused to build a second plant for the production of its models in the central part of Ukraine. Why? "This country will be destroyed by corruption ...".
The official news sounds nice and logical: “after long negotiations, the government decided that Ukraine has enough potential to develop independent production” ...
The summary of Skoda Auto, a subsidiary of the Volkswagen Group, is more prosaic - Ukraine could not provide a full-fledged site for the construction of a new multi-brand plant, the investor chose the countries of Eastern and Southeastern Europe and in 2019 finally excluded Ukraine from the list.
"EuroCar" produces almost all Skoda configurations. The plant uses SKD, all units and assemblies are imported from Europe - from factories in Romania and the Czech Republic.
In addition to production, a dealer network has been established throughout the country - since 2003, the plant has been supplying Skoda models to all dealer centers in Ukraine and constantly opens new Skoda service stations. It is EuroCar cars that occupy 7% of the entire automotive market of Ukraine and successfully compete with imported models.
Experts advise
According to the data of the current year, the production of cars in 2019 decreased by 56%. Experts believe that the country will not become a full-fledged car manufacturer in the next 10 years, and the reason is the lack of protection of the domestic market from imported products.
Vice-President of the Ukravtoprom Association E. Khazan predicted this situation five years ago.
Today the share of sales in the secondary market has increased in the country. It is profitable and easier for Ukrainians to buy a three-year-old foreign car, which is imported into the country with practically no duties, than to buy models assembled in the country.
And given that the dollar rate has tripled, the minimum cost of a domestic car is two times higher than that of an imported one.
We are not talking about the development of our brand, our equipment. AvtoZAZ was unable to re-equip its production lines to meet modern requirements.And this is the only plant in the country that had a closed production cycle.
President of the Ukrainian Union of Industrialists and Entrepreneurs A. Kinakh believes that the situation can be improved by increasing customs duties on the import of cars and centralized government orders for domestic cars.
As an example, the government order is given, which was received by the company "EuroCar", which in 2017 produced a complete set of Skoda Fabia for some units of the patrol police.
Economist A. Okhrimenko reasonably believes that "cooperation with other countries" will help to bring the industry out of the crisis.
And on paper, everything looks beautiful and promising. The experience of the Republic of Turkey, which successfully manufactures more than ten brands of the European automobile industry in cooperation with the European Union, can be taken as a basis. Only one thing is required from the government - a clear position and guarantees that the industry will develop, no matter what.
But remember why the government was unable to offer the world's largest investor Volkswagen Group a site for the construction of a plant? When Volkswagen refused to invest in the Ukrainian auto industry, this news shocked many, since the investor is considered quite loyal to partner countries and does not put forward strict requirements.
Conclusion
What will save the Ukrainian auto industry? The answer on the surface is that we need to work for the good of the Motherland, no matter how pathetic and trite it may sound. Ukraine has the most important resource for development - these are people, ordinary workers who are ready to work. It would be for what and for whom ...
