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Business news

25 Jan 2017

Belarusian-Chinese joint venture in Mogilev to make utility trucks for CIS, European Union

MINSK, 25 January (BelTA) – The Belarusian automobile engineering company MAZ and the Chinese company Zoomlion intend to set up a joint venture in Mogilev within the next few weeks in order to start making unique vehicles for special purposes. The vehicles will be intended for the markets of the Commonwealth of Independent States and the European Union, BelTA learned from Yuri Pivovarov, Deputy Head of the Office for Selling Utility Vehicles and Chassis in OAO MAZ, the managing company of the holding company BelavtoMAZ. Yuri Pivovarov is supposed to run the joint venture.

The new automaker will reside in the free economic zone Mogilev. The company will perform marketing and engineering functions. It will look for target markets, assess the demand, and design special vehicles, which are not present on the market but which potential customers abroad need. Active work will begin in February 2017. The Chinese company will contribute not only investments but also innovations to the joint venture. Utility vehicles will be made using spare premises of the Mogilevtransmash factory, which is part of the holding company BelavtoMAZ.

MAZ will provide chassis while Zoomlion will supply mounted equipment. The approach will allow combining the strong sides of the two companies to create utility vehicles that will beat the competition with better quality and a better value for money. “Some work will definitely have to go into the end product, things will be rethought and recreated anew because it is impossible to simply put together two parts as a construction kit,” said Yuri Pivovarov.

The Belarusian-Chinese joint venture is going to assemble automobile cranes, concrete pump trucks, mixer trucks, and municipal utility vehicles in Mogilev in the next few years. The company will start making other kinds of utility vehicles only after thorough deliberation and R&D. “We are not just going to replicate things. We set out to create unique vehicles that we will be able to sell on the global market,” explained the MAZ representative.

The MAZ-Zoomlion joint venture intends to assemble 100 vehicles in 2017 and over 900 utility vehicles within five years. It will allow the Mogilev-based factory to double the output of utility vehicles in addition to creating new jobs. The main target markets will be Russia, Ukraine, and Kazakhstan as well as countries of the European Union — Lithuania, Latvia, Poland, Bulgaria, and Hungary. Apart from that, there are plans to sell Belarusian-Chinese utility trucks to the Middle East, Africa, and Latin America.

Both sides are expected to benefit from the new alliance. MAZ will get access to new technologies while Zoomlion will get access to Belarusian products such as one of the world’s best chassis and a well-developed distribution chain in the CIS states and Eastern Europe. “Many people wonder why China? Because they are ready to share their best practices and enter a partnership. Russian companies are not going to share anything with us. Europeans will not do that either because they view us as competition. The Chinese private sector views us as friends. At the same time we will be able to considerably expand our market share,” stressed Yuri Pivovarov.

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