Knorr-Bremse says lessons have been learned from the former downturn in the Russian automotive sector, but cautions not every recession is the same.
The German supplier of brakes and sub-systems for rail and commercial vehicles hails the major recovery of the Russian market – albeit from a very low base during four years of falls – but remains realistic as to its future.
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“No-one is predicting [the market] to go down – this is something that makes me think it is not far away,” Knorr-Bremse Russia general director, Eduard Aniskin told just-auto on the sidelines of the recent Russian Automotive Forum organised by Adam Smith Conferences in Russia.
“We can’t go up all the time – that is why I am not really sure if we should be that much relaxed. If people say we [Russia] are not going to grow like a rocket but rather steady, it also doesn’t make me that much confident.
“Are we better prepared? We have learned lessons but I think not a single crisis has been the same as the one before. We might have learned some lessons in particular cases, but when the next one comes it will be slightly different.”
The Knorr-Bremse director also addressed one of the themes at the Moscow forum, namely whether entrepreneurship was central to the Russian experience and if the government should adopt a market-centric approach, a position advocated by Volkswagen Rus for example.
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By GlobalData“Entrepreneurship is everywhere in Russia,” added Aniskin. “It is different to the one in Europe because this is our background of Soviet times. What has changed is in the 2008 crisis the government was supporting the OEMs and manufacturers. In this crisis they switched and and at least understood it was not just 1% of the population you need to support.
“In this crisis the government went into supporting demand from the market. This [current] growth I would say is mainly driven by the low base in the previous year. You can go [the] European way and invest millions and expect when the volume will come, which could not be justified [here] because of the low volumes.
“Or you can go a cautious way to say, all right, what is possible to localise with minor investment. Using some equipment in Russia – of course it depends on what you want to localise.”
Knorr-Bremse has air compressor production in Nizhny Novgorod around 250 miles east of Moscow, where the supplier localises to 60%. Main machining and aluminium parts are also produced locally.
“We do have issues with pistons because the sizes we need are not available,” noted Aniskin. “We do buy from China and India. Commercial vehicles and mid-duty and heavy-duty trucks have been increasing during the last three years quite significantly.
“We are not yet at the level of truck production of 2013, but we are much better than it was two years ago.”
Aniskin also emphasised the importance of overseas companies coming to Russia being able to understand and appreciate the differences of doing business in the country. “If someone is coming over here and thinking, OK, here I come, I will tell you how to do it, it will never work.
“You can not just copy and paste – it will always be different. You really need to have local presence and local people who understand it.”
Knorr-Bremse’s Commercial Vehicle Systems division provides braking systems for trucks, buses, trailers and agricultural machinery. In the chassis systems sector, the supplier Knorr-Bremse is a player in electronic controls and driver assistance systems as well as in air supply systems.
Other product fields include power train-related systems and torsional vibration dampers for diesel engines.
