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Volvo in Kazakhstan
Ingemar Wenngren, a General Manager of Volvo Central Asia AB, answers questions from our magazine.
Mr. Wenngren, the Volvo brand is recognized in our country as one of the world’s leading car producers. However, the scope of activities of the Volvo Group is far wider than car manufacture. Could you tell us about this?
Today, Volvo AB is a huge company, including eight daughter corporations whose enterprises provide jobs to over 70,000 employees.
In 1998, the Volvo Group came to the decision to sell its car division, Volvo Car Corporation, to the Ford Motor Company. The group has decided to focus on manufacturing of commercial vehicles and has purchased 100% of the securities of Renault Vehicules Industriels, a corporation representing the Renault brand in Europe and the Mack brand in the USA. Consequently, we have become the largest heavy truck producer in Europe and the second in the world, thereby strengthening our hand in the US market. To date our corporations—Volvo Trucks, Mack Trucks and Renault Trucks—jointly cover 66% of the group’s total sales. In addition to these companies, the group includes Volvo Buses (manufacturing buses and bus chassis), Volvo Construction Equipment (earth moving & material handling machines), Volvo Penta (marine and industrial engines), Volvo Aero (aircraft engines and aerospace engineering), and also Volvo Financial Services, carrying out auxiliary functions.
Therefore, we are one of the world’s leading suppliers of transport solutions for commercial use.
What products does Volvo Central Asia AB offer to customers in Kazakhstan?
Volvo equipment has actually been working in the Central Asia region for quite a long time. A number of large companies in Kazakhstan, Uzbekistan, and other countries have been importing our equipment and machinery here, either directly or through various intermediaries. However, taking the dynamics and prospects of the economic development of the region into consideration, it was decided last autumn to found Volvo Central Asia AB, a company that would represent the products of corporations such as Volvo Construction Equipment and Volvo Penta.
Let me say you a few words about our founders. Volvo Construction Equipment is fourth among the world’s leading manufacturers of construction equipment. In 2002 alone, for instance, the corporation’s sales volume exceeded $2 billion. In addition to wheel loaders, on which VCE holds second place in the world market, the corporation offers its customers wheeled and crawler excavators, articulated haulers (which is VCE invention), motor graders, compact excavators and loaders. The total number of models comes to over a hundred. Our machines and equipment are widely used in industrial and civil construction, for installation work and freight handling, in the mineral and timber industries, and in many other fields. The production capacity of VCE is located on four continents. The corporation’s equipment is supplied to more than 200 countries. Recently, VCE has been extending its presence aggressively in Asia, South America, Eastern Europe and CIS countries.
At present, about 60 of the latest generation VCE machines are being used in construction and mining companies in Kazakhstan. For instance, a regular customer is Kazzinc, which has already been using Volvo equipment continuously for some years. In terms of models, excavators and wheel loaders are in the lead, followed by articulated haulers and graders. Pumps, power plants and diesel generators equipped with Volvo Penta engines are in special demand in the Caspian region. The Volvo Penta company is a world leading manufacturer of industrial and marine engines, also engines for diesel generators with a power range of 75 to 573 kW.
How is competitive ability of Volvo products kept at a high level?
Our equipment is recognized all over the world for its quality, reliability, and ecological properties. These are the core values for all of the companies in the Volvo Group. When we design our products, the main principles for us are the efficiency, productive capacity, and durability of the machines, also the comfort and safety of operators, as well as maintainability and profitability.
As for VCE, it is a leader in implementing technological innovations, investing about $120 million per year in the product development and design of new equipment. Volvo, which is continually developing automotive and marine industry technologies, is producing more new ecological and clean engines. Many of the unique components and assemblies created and patented by Volvo offer a range of possibilities that cannot be matched by other manufacturers. This factor alone gives us very important advantages in our competitive activity.
How is the system of service maintenance for Volvo machinery and equipment organized?
The customer support system is based on the concept of mobility and flexibility. Kazakhstan is a huge country, so in most cases we create customer-based solutions in order to support our customer. For example, if a company buys a number of equipment for the same location we simply place our service point within the customer’s region of activity. Mainly large Kazakhstan enterprises have their own service capabilities and then we provide them with the necessary knowledge and skills. We also provide them with timely delivery of original spare parts.
How do you view the prospects for the activities of Volvo Central Asia AB in Kazakhstan? What are your plans for the future?
We opened our Central Asia office in Kazakhstan, and that was certainly not a random choice. The country holds a leading position among the states in the region on criteria such as a favourable business environment, a developed infrastructure, and the availability of competent personnel. As for level of development of your banking system, in my opinion it is the highest in all the CIS countries. We are also monitoring the situation in Uzbekistan, planning to address your neighbours’ market in the future.
The company is looking ahead over a long period. The industries of Kazakhstan that are in our sphere of interest are currently drifting towards Western Kazakhstan. For this reason we are going to open a service centre in the city of Atyrau in the near future. In the spring, we will present a new product to our clients in Kazakhstan—the BL71 excavator-loader which has already been highly acclaimed in Europe and the USA.
Volvo BL71 in figures:
Engine                                            Volvo D4D CBE1
Rated output at r/min                       (2200)
HP                                                   94
Max torque at r/min                         1500
Nm                                                  389
Max speed, km/h                            38.5
Loader unit:
Breakout force, kN                           53.5
Lifting capacity, kg, at full height       3 152
Bucket capacity, m3                         1.0
Dump height, m                                 2.630
Height to high pin                               3.485
Backhoe unit:
Max. Digging depth, SAE
Standard dipper, m                                             4.3
Extending dipper, m                                            5.37
Max digging force, kN, SAE                              59
Bucket capacity, m3                                          0.2
Reach from swing post, standard/extending, m    5.86/6.88
Loading height, standard/extending, m                4.03/4.80
Operating weight, t                                            8.6

Table of contents
Volvo in Kazakhstan  Ingemar Wenngren 
Exhibitions are Our Business!  Edward Strachan 
Subsoil Use Contracts: Issues of Legal Classification and Systematization  Yuri G. Bassin, Maidan K. Suleimenov, Erlan B. Osi 
A Tax for Diversification, or Diversified Tax?  Janat Berdalina, Natalya Yemelyanova 
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