Bosch Siemens has big plans for Russia

German alliance Bosch Siemens has announced two new home appliances plants and a substation joint venture in Russia. It also revealed its plans for a car parts plant in St. Petersburg. The news marks a trend for manufacturing multinationals to start produ

Siemens unveiled its vast new automated machinery range for Russia, on Tuesday. It was accompanied by a series of big new project announcements.

The President of Siemens Russia Dietrich Meller said the company was considering building a car parts plant in St. Petersburg.

“Around St. Petersburg we accord a lot of activities in automotive for example, and one of the opportunities would be to look at a manufacturing site near these automotive manufacturers,” he said.

Also announced Wednesday, a new Bosch Siemens plant in St. Petersburg will start producing 260,000 fridges a year for the Russian market, on June 20. That day the tie-up will lay the first stone of a 50 MLN Euro washing machine factory also in the Noidorf Strelna technopark.

Analysts note the announcements mark a turning point in Russia’s business climate.

“Where Siemens has traditionally tried to take over Russian rivals, now foreign industrialists feel confident enough to break out on their own in Russia. Having your own production means holding on to your own company secrets and control of the complete value chain,” believes Sevastyan Kozitsyn, manufacturing analyst, BCS.

Mr Meller says focus was also shifting to the country’s regions and notably Siberia, sufficiently advanced now to underpin the company’s future growth by absorbing the new products on show.

“We are mostly today looking for opportunities outside of Moscow and St. Petersburg. For example we organized a joint venture in Kaluga, nearby Moscow. I came back last week, from three towns in Siberia – from Irkutsk, Novosibirsk and Krasnoyarsk,” Siemens executive said.

Until now Siemens has traditionally expanded cautiously by swallowing up domestic rivals. But French rival Alstom has just won a contract for a Moscow energy station through a one-off approach with Russia’s EMAlliance. This exhibition marks a shift in Siemens’ strategy from an imposed solution to a tailor-made approach for every business.