Tyumen Shipbuilders Fail to Weather the Market Storm

27.05.2009 — News

THE TYUMEN OBLAST.

Ship equipment produced by the Tyumen shipbuilders can no longer compete with foreign second-hand equipment in the Russian and CIS market. Representatives of Tyumensudokomplekt plant, a manufacturer of geared diesel engines and diesel generators, explained to RusBusinessNews that high transportation costs and ambitious policy of spare parts suppliers are to blame.

The owners of the old Soviet-era ships in the Baltic countries opt for the second-hand Volvo Penta power units because they are 15-25% cheaper than Tyumen diesel generators that cost about 18 thousand dollars including shipment.

Prospective clients in the Far East market prefer to use American and South Korean used equipment for the same reason. Caterpillar, Daewoo and some Chinese manufacturers offering unreliable products for dumping prices actively expand their operations into these regions.

In the summer of 2008, the Yaroslavl Engine Building Plant, which is the sole supplier of 180-850 HP engines for Tyumensudokomplekt, raised its prices by 30%. As the crisis occurred, the prices didn't go down. As a result, even new foreign equipment can now compete with the Tyumen plant's products.