Tag Archives: Rostekh

Cold War Sans CoCom

TMX-4000

Russia’s Kovrov Electromechanical Plant (KEMZ) is set to begin producing licensed copies of Takisawa’s TMX-4000 five-axis digital milling machine. KEMZ and Japan’s Takisawa have a contract for joint production of six machines before the end of 2021. The first is due in April 2020 and will be exhibited at Metal Working-2020 in Moscow in May.

According to a November 8 press release:

The transition to new generation digital equipment will substantially increase the volume of high technology civilian products. At KEMZ we are beginning to produce five-axis milling centers which have not been manufactured in Russia until now. One of these centers can replace several three-coordinate lathes and reduce the production cycle by several times. Potential buyers — Rostekh’s manufacturing enterprises and companies of the shipbuilding and oil processing sectors — are already interested in the model.

The advanced milling machine is designed to make complex parts for, inter alia, aircraft engines, hydraulic systems, and nuclear reactors with 5-micron accuracy. Only seven companies in the world can make such a machine, according to the press statement.

KEMZ and Takisawa have collaborated since 2013, producing six models of machine tools jointly and more than 30 modifications to systems now produced locally in the Russian Federation.

The TMX-4000 and other, essentially foreign, CNC milling systems will make much more than “high technology civilian products.” KEMZ belongs to Russian government-owned NPO Precision Systems (Высокоточные комплексы) which holds companies producing:

  • a wide variety of small arms and ammunition
  • grenade launchers
  • anti-tank missile systems
  • laser-guided munitions
  • aircraft- and helicopter-mounted guns and cannons
  • naval close-in weapons systems
  • Bakhcha and Berezhok turrets for armored vehicles
  • Arena and Drozd active armor defense systems
  • Pantsir-S1 gun-missile systems
  • Strela-10 and Igla-S SAM systems
  • Iskander-M SRBMs

One of Precision Systems’ main holdings — KBP — has been under U.S. DOT OFAC sanctions since 2014.

Precision Systems is controlled by government-owned conglomerate Rostekh which is also under U.S. sanctions.

Technology export controls and sanctions aimed at the Kremlin are an old story. They are difficult to manage. They threaten to punish allied countries and companies for doing business with Moscow in order to deter that activity and deprive Russia of commerce. They become as much a bone of contention among allies as a tool against an adversary.

During the Cold War, U.S. leadership was strong and CoCom prevented some strategic exports to the USSR. But that system, such as it was, also failed infamously.

In 1983-1984, Japan’s Toshiba sold the Russians sophisticated milling machines and Norway’s Kongsberg gave the Kremlin the computer and software needed to make more sophisticated propellers that eventually quieted its Improved Akula SSN and fourth-generation nuclear-powered submarines.

In 1987, the CIA assessed the damage like this:

Capture

But even with its massive purloining of Western technology in the 1970s and 1980s, the Soviet Union lost the Cold War. It proved incapable of exploiting the equipment and knowledge it stole. They didn’t help Moscow fix the enormous social and economic problems that doomed the CPSU and USSR in 1991.

In today’s Cold War redux, there’s little U.S. leadership, no CoCom, and a plethora of places Russia can get technology it needs and can’t produce. Now it’s buying the right to manufacture the same equipment it obtained surreptitiously nearly 40 years ago. It hasn’t fixed an economic system that struggles even to copy things.

It looked like post-Soviet Russia might join the Western community nations after the end of the First Cold War. It benefited from economic and technological cooperation and collaboration it could never imagine. As the Second Cold War unfolded, Russia largely retained that benefit despite sanctions. That benefit has been put to work in Mr. Putin’s arms buildup, in the development and production of more sophisticated weapons systems. The TMX-4000 and other machinery might be used to make an Iskander-MS (S for improved) that is on the Russian MOD’s agenda, or PAK DA, or Tsirkon hypersonic missiles, etc.

For its part, Japan only symbolically joined in sanctions against Russia following its 2014 invasion of Crimea and eastern Ukraine. Tokyo has kept its relations with Moscow on track in its (probably futile) pursuit of the Northern Territories and a peace treaty to end World War II. The Japanese also balance between Russia and China in the (probably vain) hope that the two great powers won’t get too close at their expense.

But all this is neither here nor there because, under other circumstances, it might have been a different allied country working with KEMZ or some other Russian firm.

Russia will get the technology it wants from other countries somehow, some way. The past shows that. But it’s far from certain, again based on history, that Russia can do what it wants with that technology successfully.

Foreign Electronics Still Preferred

State-owned technology conglomerate Rostekh reports that the Russian government purchases imported electronics four and a half times more often than comparable domestic products.

The complaint came from Sergey Sakhnenko — industrial director of Rostekh’s radioelectronics cluster (REK) — at a joint meeting of the Bureau of the Union of Machinebuilders of Russia and the Bureau of the Association “League for Assistance to Defense Industries” on May 31.

Sergey Sakhnenko

Sakhnenko

According to Interfaks-AVN, Sakhnenko said:

“The volume of sales of products from REK enterprises to federal government executive organs in the medical equipment, computing technology, telecommunications equipment segments and other electronics in 2018 amounted to 18 billion rubles [$275 million]. Meanwhile, the volume of state purchases just in the sphere of IT and telecommunications came to not less than 100 billion rubles [$1.5 billion] for the year.

In Sakhnenko’s words, foreign products dominate Russian government purchasing despite the existence of Russian-made analogues comparable in quality and characteristics to imported equipment.

Replying for the government, Deputy PM and arms tsar Yuriy Borisov could only state the obvious. The Russian radioelectronics industry faces the task of dominating its internal market. Domestic technology should be introduced dynamically and commercialized. Besides dominating its home market, Russian technology has to be better positioned in foreign markets. “Only under such a state policy can we raise this sector,” he said.

Pretty thin stuff for Russian electronics manufacturers.

Suffice it to say, Russia’s import substitution policies since 2014 haven’t dented Moscow’s dependence on foreign high technology products. It’s a lingering pressure point the U.S. and NATO could exploit but for the greed of their politicians and companies still more than willing to do business with Russia.

Defense Procurement in Decline?

Is the Russian MOD’s procurement declining?  It’s difficult to say, but a quick survey seems to show it hasn’t, at least not yet or by much.

buk-m3

Buk-M3

Although Russian procurement data is far from independent and probably far from complete, what Moscow claims was procured for the military is still useful. Below find a side-by-side comparison of what the MOD says it bought in the third quarter of 2015 and in the third quarter of this year.

The reporting comes from Krasnaya zvezda for 2015 and 2016, and from TASS and Bmpd.

3rd-quarter-comparison

Year-on-year in the third quarter, procurement of aircraft and helicopters appeared down.  Purchases of air-delivered ordnance were higher in 2015 because the MOD needed to replenish stocks of missiles, rockets, and bombs expended in Syria.  Deliveries of ICBMs and ships were lower in the quarter just completed.  But the navy received substantial numbers of new cruise missile systems.

The MOD reported that 62 percent of the state defense order (GOZ) was complete in the third quarter.  It also said the armed forces’ inventory of weapons and equipment is now 48 percent modern.

This week Sergey Chemezov, head of government-owned defense industrial conglomerate Rostekh and friend of Putin, echoed the president’s recent warning to firms to plan for a time without large military orders.  Chemezov said Rostekh believes GOZ procurement will peak in two years and be no more than 50 percent of its total output by 2025.

Defense News

Some Russian defense news for April 19-20, 2012 . . .

Krasnaya zvezda covered First Deputy Defense Minister Aleksandr Sukhorukov’s briefing on the progress of GOZ-2012.  He said contracting is at 77 percent, ahead of the last two years (50 and 47 percent).  The Defense Ministry’s GOZ funding was trimmed by 25 billion rubles, from a planned 704 to 677 billion (isn’t that 27 billion?).  GOZ money will be advanced in full, and 53 percent of contracts will be “long term,” according to Sukhorukov.

Sukhorukov's Press Conference

Sukhorukov told the media this year the Armed Forces will receive 28 Pantsir-S1, 58 aircraft, and 124 helicopters.  He discussed supplemental contracts for Mi-35, Mi-28N, and Mi-8MTSh helicopters.  The total GPV purchase of helicopters will apparently be 1,124.

ITAR-TASS reported Borey-class SSBN Yuriy Dolgorukiy will be accepted not later than mid-June.  Unit 2 Aleksandr Nevskiy will be accepted in August according to Sukhorukov.

This item also indicated Borey contracting for this year was almost done, and that units 4-8 will have 20 launch tubes.

Sukhorukov had no other specifics on defense procurement this year.

In its coverage of the press-conference, Arms-Expo.ru asked if GOZ-2012 isn’t broken already, at least in the munitions sector.

Meanwhile, in other OPK-related news . . .

Topwar.ru writes that small arms maker Izhmash’s bankruptcy is “going according to plan.”  Rostekhnologii’s plan, that is.

VPK.name reported the chairman of Ukrainian engine manufacturer Motor Sich’s board claims Russia will sign a contract for its first An-70 transport this year.  The GPV may include up to 60 of these aircraft.