The Kalashnikov Concern has introduced their development strategy through the year 2020. The full release can be read below:
Moscow, December 2, 2014
Concern Kalashnikov, a subsidiary of the Rostec State Corporation, has introduced a new development strategy till 2020, within its frames it will be planned to increase production activities, expand global sales and grow revenue by a factor of four times. The total investments volume is estimated as more than 4.5 milliards of rubles. The production modernization has been already started within the strategy realization.
The development strategy aims the increasing of the sales level at the nearest years with the benefit growth at the expense of production modernization and management efficiency improvement. By the 2014 overall results Kalashnikov shall be on the breakeven level and deliver to the customers more than 140,000 units of small-arms weapon, that more by a factor of two times than in 2013.
Concern Kalashnikov CEO A. Yu. Krivoruchko said: “The one of priorities of the Concern will be the position reinforcement at the internal market and active promotion of military and civil production to abroad. At the expense of taken actions to 2020 the maximum production facilities of Kalashnikov will be increased by two times (at 100%), and employers work effectiveness – by four times.Besides, the Concern’s revenue from the sales of small arms weapon is expected to be increased by four times. Kalashnikov will support the full life circle of the product from development till utilization and also will provide the scientific-research and experimental-design works for the perspective systems and arms complexes creation”.
The Concern Kalashnikov takes about 95% of small arms weapon production in Russia. At the same time, the 80% of all production does for the export. The one of priority is to search new markets and to expand existing markets. Fifty countries have been detected for this aim which have the biggest potential in the terms of “Kalashnikov” production purchasing. The Concern has already started the new markets development, and at first the Asiatic-Pacific region and Africa. India and Egypt are more perspective. The contracts with Thailand and Indonesia have been concluded recently. The active discussions take place with the Sothern America countries. And the most attention will be planed for CIS countries where the concern production demand is high traditionally.
The important process within the strategy till 2020 is the product line harmonization. After the first marketing studies “Kalashnikov” took off the production the unclaimed models releasing the resources for new weapons production. For today for these aims about 200 engineers of design bureau work on thirty great project for full weapon spectrum – from new sniper rifle to the gun. Closed presentation the first achievements for the Ministry of Defense has been already planned at the beginning of the next year. Also the realization of the complex Russian army rearming will become the one of the work direction including within “Ratnik” military outfit.
To increase production competitiveness and quality the Concern has started up the scaling program of technical rearming. More than 4.5 milliards [billion] of rubles will be provided in 2014-2017 for complex general repair work and new construction. Particularly it will allow to increase the buildings and constructions product life, decrease operating costs. Also it is planned within these resources to renew the machine park at 90%, herewith the average payback period of every machine is from two to three years which is extremely low index in the field. By the modernization completion the one new machine will replace three old and this will allow to optimize the production areas and therefore to reduce the expenses and effect on the environment during continually increased production volumes.
Also new global brand of the Concern is to assist for business development and production promotion as it is an important expansion element to the new markets and sales expansion in the civil sector. New brand will become as the base for promotion campaigns, distributors universally formed areas forming and also for dress line and accessories creation.