INDUSTRY: Ukraine’s iconic Kharkiv Tractor Plant reports return to profitability

Oleksandr Yaroslavsky’s DCH Group acquired the tractor producer in 2016 and subsequently initiated a modernization program

Business Ukraine magazine
Monday, 19 March 2018 17:35

Kharkiv Tractor Plant has reported an operational profit of UAH 48.8 million for 2017. The figure compares favorably with the UAH 667 million loss posted in 2016, reflecting the progress made since Oleksandr Yaroslavsky’s DCH Group took on the then-ailing plant in late 2016 following an extended period of inactivity. "After the forced downtime in 2016, production was restored as soon as possible. In February 2017, the first tractor came off the assembly line, and by the end of the year, 794 units of machinery had been produced," commented plant officials.

Kharkiv Tractor Plant products are currently available both on the Ukrainian domestic market and internationally. Global export markets currently include Moldova, Kazakhstan, Armenia, Bulgaria, Poland, New Zealand and Belarus, while the search for new markets continues.

Plant officials say the priority for 2018-2019 is the renewal of equipment and continued modernization of production facilities, with a budget of more than UAH 300 million available. The plant’s General Director Andrey Koval notes that this year the plant is also focusing on improving its product selection in line with client preferences. "Current production capacity ranges from 80 to 150 tractors per month, while the peak capacity of the plant makes it possible to produce up to 180 machines per month. The plant plans to produce more than 800 tractors in 2018. At present, the enterprise has already formed a portfolio of orders for 2018 based on the sale of about 300 tractors domestically and more than 500 tractors on foreign markets," plant officials stated.

The plant is engaged in a state program that sees domestic agricultural enterprises receive 25% to 40% compensation for the cost of tractors produced in February 2018. This is an upgrade from the 20% previously paid in the second half of 2017 for 87 tractors for a total of UAH 127.7 million.

DCH Group president Yaroslavsky acquired the iconic Kharkiv Tractor Plant in 2016. The plant, which dates back to 1930, was in a state of crisis at the time of its acquisition. Yaroslavsky has since acquired a number of additional industrial assets. His total investments in the Kharkiv region now exceed USD 1 billion, including over USD 300 million in Kharkiv’s preparations to serve as a host city during the Euro 2012 football championship. Yaroslavsky currently features among the top 10 of the Forbes Magazine rich list for Ukraine.

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