Kryukiv Wagon reports record output in 2011

Kryukiv Wagon Works (KVBZ UK) increased freight railcar production 18% yoy to 10,750 units in 2011, the company reported yesterday. According to the company’s CEO, the result beat its record from 1974, but was slightly below the company’s target of more than 11,000 wagons. The underperformance was explained by the failure of neighboring Kremenchuk Casting Plant to supply spare parts over October-November due to the temporary loss of Russian certification for its products. Kryukiv Wagon has so far not disclosed its output target for 2012.

Roman Dmytrenko: We believe it will be a challenge for Kryukiv to maintain its 2011 output level in 2012 as assembly capacity in the CIS railcar market is growing. While the resulting increase in competition seems a minor risk for Kryukiv Wagon, a widened deficit of railcar casting parts (as casting capacity expansion lags railcar assembly) will be the main challenge for this year.