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KAMAZ is Russia's largest manufacturer of trucks and the main employer on which the city of Naberezhnye Chelny depends. Besides trucks, the company produces buses, special-purpose vehicles, engines and components. Its shares trade on the Moscow Exchange under the ticker KMAZ.
A truck is not a consumer good but a means of production. It is bought when there is work to do: freight volumes are growing, construction is under way, a logistics company is expanding its fleet. That is why demand for trucks is cyclical and leading: it falls earlier than the economy does and recovers later.
The second feature is income after the sale. A truck works for a decade, needing spare parts and maintenance all that time, and this stream is more stable than the sales themselves. The larger the fleet of vehicles on the roads, the more predictable the service revenue.
A separate line of business is vehicles for state needs and special-purpose transport: there the customer plans purchases in advance, and the order book is known for years ahead.
The core products: long-haul tractor units, dump trucks, chassis for special-purpose vehicles.
Passenger vehicles, including electric buses for cities.
Servicing a fleet that works for a decade — income more stable than sales.
In-house production of powertrains and assemblies.
Strengths and weaknesses describe the business itself. Opportunities and threats describe what may happen around it.
The company produces trucks, buses, electric buses, special-purpose vehicles, engines and components, and also services vehicles it has already sold and sells spare parts.
Because a truck is bought for a job, not for personal use. When there is less freight and less construction, the purchase of new vehicles is the first thing to be postponed — the old ones still run. That is why the downturn in this industry comes earlier than the general one.
A truck works for a decade and needs maintenance all that time. This income stream does not depend on whether new trucks are being bought right now, and so it smooths out the cyclicality of the core business.