OMK Boosts Train Wheel Sales by 25% in 2018

As of the end of 2018, Vyksa Steel Works (AO VSW, Nizhniy Novgorod Region, a United Metallurgical Company (AO OMK, Moscow) Subsidiary) had increased train wheel sales by 25%. This is an absolute maximum in the facility’s 45-year history. The previous record of 850,000 wheels a year was set in 2012.

“Increased train wheel production and sales result from the objective to meet the current year’s peak demand from Russian rolling stock manufacturers and maintainers as well as rolling stock owners. This has only been possible as a result of VSW’s continuing large-scale investment program designed both to maintain and to expand production facilities to meet our customers’ demands to the greatest possible degree”, said VSW Director of Wheel Sales Dmitri Tse commenting on these manufacturing accomplishments.

Background

OMK has invested over 2,800,000,000 rubles into its facility that makes train wheels, including innovative and high-speed wheels. Most of the money was invested during a period of low demand in 2015-2017 which helped VSW ramp us to 100% capacity quickly at the start of a period of peak demand. The projects completed at VSW will enable it to increase production to 900,000 pieces a year in 2019. (OMK is also capable of potentially increasing VSW's production to 970,000 train wheels a year if customers can confirm demand).

With the heightened demand in the wheelset market, other train wheel manufacturers in the Eurasian Economic Union (the Urals and the Republic of Kazakhstan) have also ramped up production or commissioned new facilities. At the same time, given that the market works in cycles, lower demand is being predicted for as early as next year. Therefore, some of OMK's funds have been invested into improving the efficiency of VSW's train wheel facility to improve operational stability in a highly competitive market environment. In particular, in the second quarter of 2018, VSW closed its own open hearth furnace facility and converted to using continuous cast billets from the Ural Steel plant (an OOO Metalloinvest Management Company subsidiary). This helped reduce metal consumption in the train wheel facility.

In addition, VSW has revamped the wheel facility’s prep area which is currently equipped with state-of-the-art high-efficiency integrated saws. They produce perfectly dimensioned and weighted train wheel blanks.

Improvements to the production system of the wheel rolling facility became the most important components of its improved productivity in 2018: smaller number of change-overs and reduced change-over time, increased shaping tool life, more stable facility equipment cycles as well as improved equipment repair and maintenance processes. Thus, by optimizing rolling campaign size, the facility has been able to reduce the overall number of line change-overs virtually in half. The time to re-tool the press rolling line has been cut by a third while auxiliary operations related to shaping tools have also been reduced.