On 24 December 2015, Ukroboronprom released its Performance Report for 2015 and outlined plans and priorities for 2016.
Ukroboronprom’s top managers chose Kyiv Armor Plant as a venue for the Company’s end of year conference.
In 2015, Ukroboronprom that employs, in all, about 80,000, returned to profitability, recording UAH 1.6b in profit and UAH 3.1b in taxes paid to government. Of 7,198 pieces of armaments and military equipment (AME) delivered to Ukraine’s MoD and National Guard customers during 2015, 1,441 pieces were newly built or upgraded, 1,963 overhauled and 3,794 brought back to operational life. Those included 673 military armored vehicles, 275 motor vehicles, 135 refueling vehicles, 59 engineering vehicles, 3 radar vehicle systems, 53 aircraft, 1,830 gun launched missile systems etc.
Performance results for 2015
The Company showed a 131 percent growth in its arms export sales in 2015.
Among the industry clusters that witnessed the highest growth rates in 2015 are aviation industry with 12 percent, shipbuilding industry with 58 percent and armor industry with 61 percent.
Top four companies of the armor industry cluster delivered 197 armored vehicles, and recorded their first profit ever. Flagship products in this industry cluster include the Oplot MBT, the BTR-4E APC and the Dozor-B armored car.
Dozor-B armored car
A Dozor-B production line was launched at Lviv Armor Plant. Production of the first pre-series batch was completed in August, followed by several months of MoD testing and evaluation and official approval for service use in November.
A number of managerial decisions were taken to remove corruption schemes. The introduction of e-tendering alone saved the Company UAH 223 million and helped it find 6,800 new contractors and subcontractors.
The managerial decisions enabled a combined cost efficiency gain of UAH 375 million. Other gains from the decisions include more stable operation of constituent companies, as well as the provision of minimum required level of modernization to boost production and improve managerial infrastructure and coordination with subcontractors, Roman Romanov, CEO of Ukroboronprom said.
The Company is anticipating new contracts to meet the needs of the Ukrainian military.
Ukroboronprom is working on own R&D projects developed in collaboration with international partners. These projects particularly include a 120-mm mortar tailored for the BTR-4E APC platform, a 155-mm self-propelled gun based on the Oplot MBT chassis, weapons control and armored scout vehicles; a short-range, combat capable UAS; a next-generation radar system, the Korsar missile and launcher system and many more others.
Ukroboronprom is pursuing an import substitution strategy for over 8,000 Assembly Part and Subsystem products that Ukrainian military manufacturing companies subcontracted from Russian suppliers previously. Ukroboronprom has compiled a full catalogue of such products and distributed it among local officials in 11 oblast administrations. And it will now be the responsibility of oblast administrations (more specifically, their industrial departments) to propose companies under their respective jurisdictions to establish production of the Assembly Parts and Subsystem products that Ukroboronprom needs. Even as this effort has just been launched, as many as 114 companies not incorporated with Ukroboronprom, both state-run and privately owned, have initiated production and began delivery of 247 products.
Alongside import substitution effort, the Company is pursuing projects aimed at establishing joint venture production facilities with premier global defense companies. For now, Ukroboronprom has clinched joint venture deals with companies from the United States, France, Italy, Canada, Poland, the Czech Republic, Turkey, India and other countries. The portfolio of joint projects includes aircraft engines, early warning systems, first-aid and battlefield evacuation vehicles, a NATO-compatible self-propelled 155-mm gun system, as well as steel armor, AFV engines, weapons control systems and more projects.
In Ukroboronprom’s strategy for 2016 and onwards, development of new AME types is designated a priority line of business. New designs will be created both by domestic R&D companies and in collaboration with proven first-line suppliers from other countries. Plans for 2016 include not only production of new-generation Oplot MBTs and completion of R&D on a self-propelled gun on the Oplot MBT chassis, but also indigenous development of a heavy infantry fighting vehicle based on an all-new platform. Ukroboronprom is looking to demonstrate its own designs of robot aircraft and unmanned ground vehicles already in 2017.