Magazines — RZD-Partner International — 1 (9) March-May 2007
1 (9) March-May 2007
WE ARE ON THE RIGHT TRACK: 2006 was dramatic for Russia’s railways as the industry goes through a period of fundamental transformation. The main actor in the reform and at the same time the company most affected by the changes is OAO RZD (Russian Railways). Vladimir Yakunin, president of Russian Railways, comments on OAO RZD’s achievements in 2006 and the prospects for the reform.COAL SECTOR: NEW URGE: In 2006 loading of coal increased by 3.3% year-on-year, which exceeds the rates of the average loading on OAO RZD’s network and the company’s plan. During the first ten days of January, the loading volume of the cargo increased by 13.6% year-on-year, which proves that the interest to the Russian solid fuel is high on both the domestic and foreign markets, in spite of the warm winter.
REFCONTAINER PATIENCE: Considering the world tendency for cargo containerization, more and more attention is paid to the use of refrigerator containers to transport perishable goods. However, problems of refcontainers used for domestic transportation in Russia exceed the obvious prospects of this technology.
Contents
Editorial
EDITORIAL
It is a real pleasure to conclude results of the Russian transport sector functioning in 2006. The industry boomed in line with development vector of the country’s economy. Operation results analysis and overview of the sector’s activity you will find in the Theme section «Trends of the Russian Transport Market» (see pp. 6-21). However, such a vivid development raised a problem of insufficient infrastructure condition and worn rail, river and sea fleet.«We are on the right track»
THEME / Trends of the Russian Transport Market
2006 was dramatic for Russia’s railways as the industry goes through a period of fundamental transformation. The main actor in the reform and at the same time the company most affected by the changes is OAO RZD (Russian Railways). Vladimir Yakunin, president of Russian Railways, spoke to The RZD-Partner International Magazine about the work last year and the prospects for reform.
Russian Transport in 2006: Development Vector Set
THEME / Trends of the Russian Transport Market
The editorship of the RZD-Partner International magazine would like to offer you a review of most significant events that occurred in the Russian transport sector last year and which happened to be most influential in terms of further development of the transport services market of Russia.Push to Development
THEME / Trends of the Russian Transport Market
«After Russia has joined the WTO, which will result in mobilization of big foreign players, the Russian companies will have to increase their competitiveness, and consolidation in the transport sector will continue», such forecast about the transport complex of Russia was given by , CEO of ÎÀÎ Sovfracht and Sovmortrans.
Future Belongs to the Big Players
THEME / Trends of the Russian Transport Market
«Nowadays in Russia the process of consolidation is unfolding. To complete it, 3-4 years will be needed. As a result, according to our forecast, about 5-7 bid companies will play on the market», Valery Shpakov, acting CEO of Novaya Perevozochnaya Company (New Transportation Company) believes.
Is It Good When It Is Stable?
THEME / Trends of the Russian Transport Market
«Nowadays the Russian transport market has reached a certain parity. Its participants evaluate their opportunities, prospects and the so-called threats for reached stability», Sergey Nazarov, First Deputy CEO Yukos-TransService, believes.
According to the State Economy …
THEME / Trends of the Russian Transport Market
The RF Federal State Statistics Service has summed up the results of transport complex functioning during 2006. In general, cargo turnover of the country grew by 2.2%, while railway transportation growth made 5%, which is the best sectoral result (1950.9 trl tons per kilometer). This result exceeded the company’s plans by 0.7%. Sea and water transportation demonstrated a certain decrease (-5.1% and -17.5% respectively).Panorama
ECONOMICS
Assets Exceeded RUR 83 Billion «In 2006, the total volume of assets of OAO RZD’s daughter companies is to exceed RUR 83 billion, and the net profit is to make RUR 4.3 billion», said President of OAO RZD Vladimir Yakunin at the meeting of the company’s Board.
Investors are offered to link Moscow and St.-Petersburg by a Highway
AIR TRANSPORT
Construction of a toll highway between the Russia capital Moscow and St.-Petersburg, the second-largest city of the country, is put into action. Potential investors are standing in a queue to take part, automotive carriers are ready to pay, but as usual there are skeptics who don’t believe in the success of the idea. And the project may really have some risks.
Ukrainian Transport Sector: Change of Fate
ECONOMICS / CIS and Baltic States
Last year was such a period for Ukraine, when the state started to revise the conditions of the transport sector for the first time, which was a practically unprecedented event in the history of independent Ukraine.
Panorama
TRANSPORTATION
Target Can Be Reached«To increase the volume of container transportation via the Transsib to China to one million TEU per annum by 2010 is a target that can be reached. Nowadays, the new tariff transit policy for container transportation has been developed, and the annual dynamics of the growth amounts to 13-14%», stated First Vice-President of OAO RZD Vadim Morozov...
Coal Sector: New Urge
TRANSPORTATION / Cargo and routes
In 2006, loading of coal increased by 3.3% year-on-year, which exceeds the rates of the average loading on OAO RZD’s network and the company’s plan. During the first ten days of January, the loading volume of the cargo increased by 13.6% year-on-year, which proves that the interest to the Russian solid fuel is high on both the domestic and foreign markets, in spite of the warm winter.
Ambitions Justified by Target
TRANSPORTATION / Container transportation
Nowadays the international market of container transportation is actually closed for most Russian carriers. Experts have emphasized that the only chance for Russia to resist western leaders’ expansion is to launch a big competitive company. At the moment OAO RZD subsidiary TransContainer aspires to take this niche. Pavel Chichagov, Deputy CEO on strategic development, comments on the company’s plans to reach the world market of container transportation.
Refcontainer patience
TRANSPORTATION / Container transportation
Considering the world tendency for cargo containerization, more and more attention is paid to the use of refrigerator containers to transport perishable goods. However, problems of refcontainers used for domestic transportation in Russia exceed the obvious prospects of this technology.Postponed competition
TRANSPORTATION / Logistics
Russian national logistics providers and international world-branded operators share the same booming market quietly, peacefully, without great competition. International companies need domestic ones as partners because of necessity to allow for specifics of the country’s legislation and mentality. But as soon as Russia maintains worldwide standards, foreign operators will prefer to merge locals."We Are Partners, Not Competitors"
TRANSPORTATION / Logistics
Russia is a very interesting, but at the same time a very specific market, says , managing director of Fiege Rewico International GmbH. May be for this reason Mr. Leuschner speaks Russian language fluently: a language is a key to understand peoples mentality and without such an understanding a logistics provider with western background is likely to fail in Russia.
Electric-Hydraulic Lift Table Produced by Transprogress Plant (Moscow)
TRANSPORTATION / Logistics
In the framework of the exhibition «Warehouse. Transport. Logistics - 2006» in Moscow, the electric-hydraulic lift table with triple scissors, produced by OJSC OEMP Transprogress (Russia), was awarded the gold medal in the competition «The Best Machinery and Equipment for Warehouse».New Big Air Carrier arrival is delayed again
TRANSPORTATION / Air Transport
The strategy of the Federal Air Transport Agency envisages that Russia will focus on airlines consolidation. What does Russian airlines market look like nowadays and how efficient is AirUnion?Panorama - Company
COMPANY
OAO RZD’s Management System to ImproveOAO RZD is launching the project «OAO RZD’s Management system Formation under Reform». The new management system is to be implemented by June 2008.
Steadiness Means Mastery
COMPANY / OAO RZD
The last year results of the Russian railway transport work demonstrate the stable dynamic development of the sector. The main production figures increase, the investment plans grow, and the prospects seem to be promising. Although, the shortage of rolling stock, which became obvious in the middle of 2006, prejudices against OAO RZD’s ability to fulfill all the requirements of its clients.
Basic Instrument
COMPANY / OAO RZD
In spite of the growth of freight volume carried by OAO RZD, it is obvious that the future of the railway sector belongs to the quality competition. Deputy CEO of the Center of Transport Services of OAO RZD Artur Kalukhov comments on the situation.
FESCO: On the Way to Global Containerization
COMPANY / Carrier
The Industrial Investors Group, launched in 1999 and uniting the fund of direct investments, managing companies and enterprises of the key sectors of Russian economy, actively carried out the strategic plan of creating a multimodal system for containerized cargo transportation last year.
Cargo Operators Not Afraid of Responsibility
COMPANY / Operator
The term «rolling stock operator» is unclear to European business where typically a difference is made between the infrastructure owner and the railway carrier. However, the Russian practice proves that competition on the railway market can work only due to operator segment development on the basis of which new public railway carrier arrival seems possible.«We are here for long-term projects»
COMPANY / Doing Business in Russia
Bombardier’s long-standing relationship with Russia and the CIS began more than half a century ago. Many things have changed since that time. Sergey Ermolaev, Bombardier Chief Country Representative, tells us about the company’s present and future projects on the Russian market.
Export Machine Building Yet to Come?
PRODUCTION AND SERVICES / Rolling Stock
There is no clear answer regarding the present day situation on the Russian machine building market. Results of 2006 clearly show this.Russian Machinery for Global Markets
PRODUCTION AND SERVICES / Rolling Stock
«Additional support of the state is crucially important for the Russian transport machine building sector», believes CEO of TSZ Titran-Express Viktor Tikhonov.
Development of High-Speed Operation in Russia
PRODUCTION AND SERVICES / High-Speed Operation
Is there a legislative base for high-speed transport infrastructure construction efficient formation in Russia? Can the Russian Federation carry out a scaled infrastructure project, in which large Russian and foreign companies and international banks can take part, based on the current legislation?
Adventures of Foreign Companies in Russia
PRODUCTION AND SERVICES / High-Speed Operation
In the last 15 years, all the largest Western producers of rolling stock for speeded up and high-speed communication opened their representative offices in Russia. A correspondent of The RZD-Partner International tried to find out what services are popular in Russia.Customs – 2006: Year of Changes
PRODUCTION AND SERVICES / Customs
Last year has become one of the most efficient periods for the sector. It was the time when such large-scaled and significant changes occurred as the yielding of custom-houses control to the Government, recruiting top-executives, developing and approving basic normative-and-legislative documents. What are other results that the Russian customs have reached by now?Evolution by Gegel
PRODUCTION AND SERVICES / Warehousing
In Russia the manner how dialectical contradictions «to buy or to rent» are resolved often depends on the stage of life cycle of a company. Different stages have absolutely different decisions.Effective Exhibition Solutions from The RZD-Partner
PRODUCTION AND SERVICES / Exhibitions and Symposia
Nowadays companies face the necessity to search for new markets as well as alternative ways of promoting their products and services. As a result Russia has become one of the most interesting regions for the world business. However, for a foreign newcomer to the Russian market it may seem rather risky and cause certain difficulties due to national specifics.