Machine tools in Russia

Main article: Russian economy

2024

The Ministry of Industry and Trade recovered 502 million rubles from Rostec for failure to comply with the state program for machine tool construction

In October 2024, the Moscow Arbitration Court recovered 502 million rubles from the Rostec state corporation in the form of a fine for failure to comply with the state program for the development of the machine tool industry. The third parties were JSC Joint Technological Enterprise Perm Plant of Metalworking Centers (STP PZMC) and JSC Stankoprom. Read more here

130 billion rubles allocated for the development of machine tools in Russia

The Russian government has allocated 130 billion rubles for the development of machine tools in the country over the next three years. This became known in July 2024.

Russian Prime Minister Mikhail Mishustin announced large-scale plans for the technical re-equipment of machine tool and equipment manufacturers. The funds will be used to modernize existing enterprises and create new production facilities.

Within the framework of the federal project on machine tool construction, it is planned to create and modernize more than 70 enterprises by 2030. This will make it possible to produce over 170 thousand machines and processing centers, as well as increase the level of robotization of domestic industries.

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The Deputy Prime Minister Ministry of Industry and Trade of the Denis Manturov noted that the planned state funding is unprecedented for the industry. He stressed the importance of developing machine tools to increase the technological independence of the country and strengthen industrial potential.

In addition to direct investment in machine tools, the government plans to create centers for the development of industrial robotics. This initiative is aimed at Russia becoming one of the 25 world leaders in the density of robotization of production. Mikhail Mishustin explained:

The increased use of automation tools directly affects the increase in labor productivity. And ultimately on the rate of economic growth. This means that the welfare of citizens and the social sphere.

The development of machine tools is part of a broader strategy to strengthen the industrial sector of Russia. In 2023, various support measures, including R&D subsidies and loans from the Industrial Development Fund, provided investments in industry in the amount of 450 billion rubles.^[1]

2023

The volume of the metalworking machine market in Russia for the year exceeded 1 million units. 12.1% of equipment exported

At the end of 2023, the volume of the metalworking machine market in Russia in physical terms amounted to more than 1 million units. This is 32.3% more than in the previous year. Such data are reflected in a study by NeoAnalytics, the results of which were published on November 5, 2024.

Analysts take into account equipment such as turning, drilling, boring, milling, nut cutting, thread cutting, longitudinal cutting, saw and cutting walls, as well as machines for removing burrs, grinding and grinding installations and equipment for other metal refinement. Machine tool building is the basic industry of the Russian industry and determines the competitiveness of domestic engineering and industry as a whole.

It is noted that the growth of the market is primarily due to the increase in imports. The share of domestic products is small and amounts to no more than 3%. Among the significant players in the industry are named PJSC "Sasta," JSC "Stankomash Complex" ("Tver Machine Tool Plant"), LLC "Stankomash Stroy," LLC "Lipetsk Machine Tool Plant," LLC "Unimatik," JSC "Armez," LLC "ESM," JSC "Krasnodar Machine Tool Plant" Sedin "and OJSC" Ivanovsky Heavy Plant. "

The study says that in 2023, in the total volume of Russian production of metal-cutting machines in physical terms, the share of export supplies amounted to 12.1%. A year earlier, this figure was almost twice as much - 23.3%. In the formed geopolitical situation, the structure of exports and domestic consumption has changed dramatically: for example, in 2021, exports amounted to 83.7%, while domestic consumption accounted for 16.3%. In 2023, the bulk of metal-working machines produced in Russia were purchased by domestic customers.^[2]

The production of metalworking machines in Russia soared by 63.8% over the year, to 20,163 machines

In 2023, 20,163 metalworking machines were produced in Russia. This is 63.8% more than in the previous year, when the figure was 12,313. One of the main growth factors is import substitution against the background of the emerging geopolitical situation. This is stated in a study by BusinesStat, the results of which were released on August 19, 2024.

The review takes into account laser, turning, grinding, grinding, drilling and thread cutting machines, machining centers, bending and forging machines, as well as other metal cutting machines. Among the key market players are named JSC Stankomashkompleks, PJSC Association Ordzhonikidze 11, LLC NPO Tekhstroy, JSC VNITEP and LLC AMN Engineering.

According to estimates, in 2019, 8762 metalworking machines were produced in the Russian Federation. In 2020, a decline of 5% followed - to 8323 pcs. The COVID-19 pandemic and related restrictions have negatively affected supply chains, and businesses have been forced to cost fewer employees. This led to a decrease in production volumes, coupled with a decrease in demand.

In 2021, the market returned to growth: the increase was 13.5% with a final result of 9449 machines, and in 2022 there was an increase in production by another 30.3% - to 12,313 units. The study notes that in 2021-2023, the production of metalworking machines in Russia rose 2.4 times. Analysts attribute such rapid development of the industry to several factors:

• State support for manufacturers of metalworking machines, in particular, in the form of import restrictions;
• Increasing the size of the state defense order in order to re-equip enterprises;
• Devaluation of the ruble, which led to a rise in the cost of imported equipment;
• A rush increase in demand for machine tools in 2022-2023.^[3]

Increase in imports of machine tools by 61% to 59.8 thousand units

In 2023, about 59.8 thousand machines for processing materials were imported to Russia. Compared to the previous year, when approximately 37.1 thousand such installations were imported into the country, the figure jumped by 61.2%. Relevant data are provided in the BusinesStat report published on March 22, 2024.

The data presented take into account the import of woodworking and metalworking machines, as well as machines for processing stone, concrete and other similar materials. These are, in particular, saw, lob, planing, milling, grinding, polishing, drilling and downhole installations, laser, turning, grinding, grinding, drilling and thread cutting machines, machining centers, bending and forging machines, etc.

According to estimates, in 2019, 27.5 thousand devices of the listed types were imported into Russia. In 2020, an increase of 4.5% was shown - to 28.7 thousand units, and in 2021 imports rose by 24.3%, reaching 35.7 thousand units. In 2022, against the background of the emerging geopolitical situation, the countries of the European Union, Britain, the United States, Japan and Switzerland limited the sale of all types of machine tools to Russia, as a result of which imports decreased. But at the same time, China sharply increased the supply of equipment, which made it possible to compensate for the decline. As a result, at the end of 2022, 37.1 thousand machines were imported into the Russian Federation - plus 4% on an annualized basis.

In 2023, as stated in the BusinesStat study, a rush demand for equipment was formed in Russia due to the need to restructure industry against the background of severing ties with Western countries. Domestic manufacturers required a large number of machines for import substitution of many goods and components. In addition, difficulties arose in maintaining European and Japanese equipment. In such a situation, the import of machine tools from China increased by 20.5 thousand units at the end of 2023.^[4]

2022

Increase in imports of metalworking machines by 27% to 20.9 thousand units

At the end of 2022, about 20.9 thousand metal-working machines were delivered to Russia from abroad, which is 27% more than imports a year ago. Such figures are provided in a study that the analytical agency BusinesStat published in November 2023.

According to experts, China is the main supplier of metalworking machines to Russia: in 2022, two-thirds of the imported equipment was Chinese products. Significant volumes of machine tools in 2022 were also imported from Turkey, Taiwan and South Korea.

The report also said sanctions and a gradual end to trade with Western countries had caused uncertainty among consumers about future deliveries of metalworking equipment. The needs of the Russian economy and the defense industry in high-tech equipment also increased. All this led to a significant increase in the import of machine tools. Importers sought to purchase affordable European and Asian machines as soon as possible, until a complete ban was imposed on deliveries, as well as to purchase inexpensive Chinese equipment for future use. The low exchange rate dollar and high export revenues of Russian corporations in 2022 contributed to investing in expensive foreign equipment, including metalworking machines, analysts emphasize.

They add in a study (published in November 2023) that after a sharp increase in imports in 2022, demand from domestic buyers is expected to decline in the next couple of years due to the exhaustion of rush demand, the weakening of the ruble, as well as difficult international logistics amid sanctions. The departure of European manufacturers from the Russian market will also play a role.^[5]

Significant increase in demand for domestic machines after the departure of foreign suppliers during the conflict in Ukraine

The departure of foreign machine tool companies from the Russian market during the conflict in Ukraine in 2022 led to the fact that the demand for products from domestic manufacturers in this industry has grown significantly. However, it is not yet possible to completely replace the "foreigners."

The goal of the Ministry of Industry and Trade is to increase the sales rate of domestic machine tools in Russia from 30% to 50% by 2050. The rest, officials believe, will cover imports.

2021: Share of Russian machines in the domestic market - 30%

Russia is not included in the top 10 machine tool manufacturing countries, being in this indicator only in 33rd place in the world. According to the Ministry of Industry and Trade, the share of Russian machine tool production from 2017 to 2021 from 15% increased to 30%.

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