The car battery manufacturer Akom will receive government support

The car battery manufacturer Akom will receive government support

Vedomosti – The committee of experts from the Russian Ministry of Industry and Commerce Development Fund has approved a subsidy of 500 million rubles for the Russian car battery manufacturer Akom. The company will use the fund, which has an annual return rate of 5%, for the organisation of the production of high-cycle EFB, AGM and GEL type batteries. As reported by Vedomosti, the aforementioned batteries are not being manufactured in Russia on a mass scale yet.

Akom plans to increase its annual capacity by 75% to 3.15 million units, with the help of the fund. The majority of the resources needed for the project, the cost of which adds up to 1.2 billion rubles, will be covered by the company itself. The serial production is planned to start during the second half of 2016. In this way, Akom intends to pull down the market share of the imported products in its own favour.

A representative from TUBOR, another car battery manufacturer interviewed by the Vedomosti newspaper, states that the aforementioned technology is not new to Russia, mentioning the EFB production made by TUBOR, however, the plans to increase production have been postponed for a year, following the devaluation of the ruble.

According to Autostat data, the number of car batteries supplied to Russian automobile factories had shrunk by 13.8% in 2014, with 1.92 million units. The shrinkage rate in components market is 9% and the car battery sales figure is 9.5 million. On the other hand, the number of car batteries manufactured in Russia has risen by 10%, to 6.7 million.

Autostat analysts state that the market shrinkage will continue throughout 2015. The growing lifespan of batteries is one of the reasons behind the shrinkage. Akom’s new batteries will last three times longer than the previous ones, according to Fund data. The company data states that the new batteries are 20% more expensive compared to the older ones, but 20-30% cheaper than the imported analogue batteries.

Akom currently supplies AVTOVAZ, GM-AVTOVAZ and Ford Sollers with products. The company aims to extend this list with the addition of companies, such as Renault and Nissan.