16 March 2014 | 18:14

Railway manufacturing plant workers might face unemployment

Photo a courtesy of news.ivest.kz

Employees of Ekibastuz-based PromMashKomplekt plant can lose their jobs, Tengrinews reports citing the plant's Executive Director Artur Khachaturyan. In 2012, PromMashKomplekt signed a long-term agreement with KazTemirTrans, a subsidiary of KazakhstanTemirZholy (Kazakhstan's main railway operator), on production of solid-rolled railway wheels in 2012-2015. The plant says that the company now refuses to buy the wheels in accordance with that agreement. “KazTemirTrans is our main consumer. The goods were produced in accordance with the long-term agreement, but the company refuses to buy them. As a result, thousands and thousands of wheels are being stored at our plant since summer, ” the workers complain. Director Khachaturyan says that the company refuses to buy the wheels saying it no longer needs them. But in the meanwhile KazTemirTrans is purchasing similar wheels from Russia. Interestingly, the manufacturing project was initiated by President Nazarbayev in 2012 as part of the strategy to develop local railway manufacturing industry. “Due to KazTemirTrans’ failure to act on the agreement, we were $19 million short last year. Today we have more than 540 employees. If the situation does not change, most of them will lose their jobs,” Khachaturyan says. PromMashKomplekt plant produces railway wheels and railroad crossing pieces and switches. The plant's capacity is enough to produce 48 thousand wheels a year which satisfies the demand of the entire railway sector in Kazakhstan. “We want to progress from making wheels to the complete production cycle by creating a railway cluster. But I’m afraid we will have to put the projects on hold,” the Executive Director says. The parent company KazakhstanTemirZholy have given their part of the story. “In March 2012, KazTemirTrans signed a long-term agreement with PromMashKomplekt for the plant to supply solid-rolled railway wheels in 2012-2015. In accordance with the agreement, there was a delivery plan and 2,700 had to be supplied in 2012. But the plant delivered zero wheels in 2012. The reason it gave for breaching the agreement was that it was not assigned the reference number for marking the wheels and that the certificate of origin for CT KZ wheel type was not issued to it (by the authorities),” the press office of the railway company explains. Later on, in 2013, the plant also failed to honour the agreement and supplied only 4,532 wheels out of the scheduled 25,400. The plant gave the same reasons as for the previous year's failure, the press office says. In 2014, the plant is supposed to supply 32,600 solid-rolled wheels. The delivery of the first batch of 10,000 has already started. In compliance with the agreement, KazTemirTrans has made a deposit payment of $301 thousand which makes 30% of the cost of the agreement. “As of February 7, 2014, only 4450 wheels have been received from PromMashKomplekt. In Kazakhstan, besides KazTemirTrans, there are 171 private freight wagon owner registered with a fleet of 61 thousand wagons. However, the private operators prefer ordering solid-rolled railway wheels from other manufacturers because their wheels are cheaper, whereas KazTemirTrans purchases wheels from PromMashKomplekt to support the local manufacturer,” the company representative says. In the statement, the company does not mention purchasing wheels from Russian manufacturers. No one knows what happened to the "thousands of wheels" stored at the plant. And while the plant and the company cannot determine who is at fault, the employees of PromMashKomplekt have their own worries about what the next day is going to bring.

Employees of Ekibastuz-based PromMashKomplekt plant can lose their jobs, Tengrinews reports citing the plant's Executive Director Artur Khachaturyan. In 2012, PromMashKomplekt signed a long-term agreement with KazTemirTrans, a subsidiary of KazakhstanTemirZholy (Kazakhstan's main railway operator), on production of solid-rolled railway wheels in 2012-2015. The plant says that the company now refuses to buy the wheels in accordance with that agreement. “KazTemirTrans is our main consumer. The goods were produced in accordance with the long-term agreement, but the company refuses to buy them. As a result, thousands and thousands of wheels are being stored at our plant since summer, ” the workers complain. Director Khachaturyan says that the company refuses to buy the wheels saying it no longer needs them. But in the meanwhile KazTemirTrans is purchasing similar wheels from Russia. Interestingly, the manufacturing project was initiated by President Nazarbayev in 2012 as part of the strategy to develop local railway manufacturing industry. “Due to KazTemirTrans’ failure to act on the agreement, we were $19 million short last year. Today we have more than 540 employees. If the situation does not change, most of them will lose their jobs,” Khachaturyan says. PromMashKomplekt plant produces railway wheels and railroad crossing pieces and switches. The plant's capacity is enough to produce 48 thousand wheels a year which satisfies the demand of the entire railway sector in Kazakhstan. “We want to progress from making wheels to the complete production cycle by creating a railway cluster. But I’m afraid we will have to put the projects on hold,” the Executive Director says. The parent company KazakhstanTemirZholy have given their part of the story. “In March 2012, KazTemirTrans signed a long-term agreement with PromMashKomplekt for the plant to supply solid-rolled railway wheels in 2012-2015. In accordance with the agreement, there was a delivery plan and 2,700 had to be supplied in 2012. But the plant delivered zero wheels in 2012. The reason it gave for breaching the agreement was that it was not assigned the reference number for marking the wheels and that the certificate of origin for CT KZ wheel type was not issued to it (by the authorities),” the press office of the railway company explains. Later on, in 2013, the plant also failed to honour the agreement and supplied only 4,532 wheels out of the scheduled 25,400. The plant gave the same reasons as for the previous year's failure, the press office says. In 2014, the plant is supposed to supply 32,600 solid-rolled wheels. The delivery of the first batch of 10,000 has already started. In compliance with the agreement, KazTemirTrans has made a deposit payment of $301 thousand which makes 30% of the cost of the agreement. “As of February 7, 2014, only 4450 wheels have been received from PromMashKomplekt. In Kazakhstan, besides KazTemirTrans, there are 171 private freight wagon owner registered with a fleet of 61 thousand wagons. However, the private operators prefer ordering solid-rolled railway wheels from other manufacturers because their wheels are cheaper, whereas KazTemirTrans purchases wheels from PromMashKomplekt to support the local manufacturer,” the company representative says. In the statement, the company does not mention purchasing wheels from Russian manufacturers. No one knows what happened to the "thousands of wheels" stored at the plant. And while the plant and the company cannot determine who is at fault, the employees of PromMashKomplekt have their own worries about what the next day is going to bring.

unemployment factory Kazakh Kazakhstan Kazakhstan Temir Zholy manufacturing news plant railway business