Ford Sollers will restart the engine plant in Yelabuga
JV «Sollers Ford» will restart the engine plant located in the Alabuga special economic zone in Tatarstan, said a company's representative. It is planned to produce diesel engines for the Ford Transit van line. Serial production is planned for 2023.
Production of Sigma 1.6L petrol engines started at the Yelabuga plant in 2015. These products were used on Ford passenger models which were made at the Sollers Ford factories in Naberezhnye Chelny and Vsevolozhsk (Leningrad region).
In 2019, Ford Motor Company decided to leave Russian passenger car market. The control in JV «Sollers Ford» (51%) transferred to «Sollers» Vadim Shvetsov. Ford Transit van production plant with a design capacity of 85,000 vehicles per year in Yelabuga remained in JV while other automobile plants and engine production were closed. In 2019, the plant in Yelabuga produced 12,589 Ford Transit.
Closed plants became the property of the Ford motor company and the company planned to sell them. The Russian auction house has already held two auctions for the sale of these enterprises property. Today, the motor plant in Yelabuga has again become the property of JV, said the Sollers Ford representative.
Total investment in the new project "Sollers Ford" will amount to 627.1 million rubles, said a representative of the Industrial Development Fund (IDF).
500 million rubles will be provided to the IDF as a loan on preferential terms, the rest – the company's own funds. The investment will be used to purchase a production line for the cylinder block machining shop. "Today, Russia does not produce modern competitive diesel engines suitable for LCV," says the company's representative.
Currently, Ford Transit vans manufactured by «Sollers Ford» are equipped with imported Duratorq engines with 125-155 h.p. capacity. The company does not disclose new power unit characteristics which will be produced in Yelabuga.
"We plan to localize this production," said company’s representative answering the question whether the components will be Russian or foreign. The engine is unlikely to be localized at the initial stage, says Vladimir Bespalov, an analyst of «VTB capital».
"As part of the project funded by the IDF, it is planned to produce 25,000 cylinder blocks annually," said Sollers Ford. The pre-planned output is estimated 25,000 engines per year. The former plant was designed for a maximum capacity of 200,000 engines per year, but the capacity was excessive, said experts. In the first year and a half, the plant produced 25,000 engines.
In the future, the products of the new engine plant can be used for other projects except the Transit van, says Bespalov. "It makes no sense to restart the plant only for Ford Transit, as its output is small. I think that in the future there may be cooperation with UAZ or the Japanese Isuzu – the partner of Sollers," says Bespalov. Isuzu representative has not yet responded to request of «Vedomosti».
The export potential of such an engine is low, Bespalov continues, but Sollers Ford can reach the production volume of 25,000 Transit vans per year due to the development of the e-сommerce market and goods delivery, where the model is popular. «Sollers» will also develop its own model range which can be equipped with this engine," adds the expert.
The leader of the LCV market in Russia is GAZ Gazelle Next (26,941 units in 8 months), Ford Transit occupies the 2nd place: in January-August, 7856 vans of this brand were sold that is 2.2% more, compared to the same period in 2019. Lada Largus VU vans took the 3rd place (6765 units in 8 months), according to AVTOSTAT.
Another diesel production in Russia – «Cummins Kama» in Naberezhnye Chelny (JV «Cummins and KAMAZ») – produced more than 10,000 engines in 2019, this year it plans to produce almost 12,000 engines, said a representative of KAMAZ. However, the products of this plant, as well as the Yaroslavl Motor Plant (part of the GAZ group) belong to a different class of engines in terms of capacity – they are used on heavy trucks "KAMAZ", "Ural", "MAZ" and buses.
Diesels for LCV are produced in small volumes for models "UAZ Hunter" and "UAZ Patriot" by Zavolzhsky Motor Plant (part of Sollers»). However, these items are exported, says the representative of "Sollers". The main products of the plant are still gasoline engines for UAZ and PAZ.
Original article is on the VEDOMOSTI website