Ford Sollers says from this year it will localise production of seats in Russia as the company looks to ramp up the proportion of domestically produced components.
The company is a major player in the country with three car plants and 76 suppliers spread across the vast country, from the Volga region to central Russia to St Petersburg.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
“We try to reduce costs of the parts we buy and we always remember quality,” said Ford Sollers commodity director, Elena Morozova at the recent Russian Automotive Forum in Moscow. “Russia should not be different from the quality of parts other Ford plants are using.
“We use Decree 166 so we have to be focused on localised production. We need to be a profitable company and we have to use localised products wisely. One opportunity [for those products] is export – our suppliers get an opportunity to export. We have technical support for our suppliers aiming at quality improvement – this is the 21st century – we try to do more in smart mobility and connectivity.
“In the past we have been only assembling seats – starting from this year we are going to use local structures for seats. Let me share some success stories – let’s talk about steel; 95% of parts are produced by local steel. We want to increase that by another 5%.
“We use localised resins to produce 45% of locally-moulded parts. Russia has also introduced a new technology of laser welding. At the same time of course, we face certain challenges with localisation and I am referring primarily to Tier 2 and Tier 3 components.”
Ford Sollers’ largest component cluster is in the Volga region where 47 suppliers are located, followed by 19 in Central Russia and ten in the St Petersburg area. These include Tier 1 and Tier 2 suppliers of steel, aluminium and plastics.
Despite Russia’s emergence from four years of catastrophic domestic performance, particularly in the automotive sector, the rouble still remains relatively weak, allowing opportunities for some suppliers to capitalise on export potential.
“We know what has happened to the rouble exchange rate and of course we want to maximise exports,” added Morozova. “We are telling them [suppliers] they should develop their technologies and should have the capability to develop innovative products.
“We see quality as the main priority and we try to maximise exports.”
