The transformation office for reforming Uzavtosanoat starts its work
Tashkent, Uzbekistan (UzDaily.com) -- The transformation office for reforming Uzavtosanoat and its structural enterprises, created in accordance with the instructions of the country’s leadership and formed together with the Boston Consulting Group (BCG), has begun its work.
The reorganization of the automotive industry in Uzbekistan will be a logical continuation of the reforms initiated by Uzavtosanoat back in 2018 as part of the country’s leadership policy aimed at radically reforming the economy, accelerating industrial development and reducing state participation in economic activity.
The result of these reforms has already been an increase in production volumes, a significant increase in tax payments to the country’s budget, an increase in the level of localization and the introduction of transparent sales mechanisms.
The joint implementation of the industry transformation program will create the necessary economic conditions for reforming the automotive market and improve the competitive environment in the country through the transformation and gradual privatization of Uzavtosanoat and its structural enterprises.
The transformation office was formed with the participation of the Boston Consulting Group (BCG), as well as highly qualified foreign and local experts with many years of experience in leadership in the world’s leading automotive groups such as Daimler, Fiat and Porsche. Participation in the transformation of such specialists will help build an effective business model that is competitive in market conditions. In addition, during the transformation process, it is planned to abandon the old model of industry management and modernize production and business processes, which will directly affect the quality and volume of products.
The result of effective management will be the development of new directions of production and an increase in the level of localization up to 70%, which will reduce the retail cost of products. At the first stage, this program already implies the launch of local production of such models as the Chevrolet Tracker and Onix.
The growth of production indicators will also give a positive trend in all contributions to the country’s budget, the share of the automotive industry, which has already significantly increased in these years. Despite the conditions of the pandemic, in 2021, one of 80 enterprises in the industry, UzAuto Motors, entered the top ten largest taxpayers in the country.
The first meeting of the transformation office was held with the participation of representatives of the Ministry of Finance, the Ministry of Economic Development and Poverty Reduction of the Republic of Uzbekistan, as well as international experts from BCG.
The transformation processes will be carried out in the following seven directions, indicated in the Development Strategy of Uzavtosanoat, developed jointly with BCG:
1. Sales and Marketing;
2. Cooperation with new producers and privatization;
3. Working with buyers and suppliers;
4. Improvement of production processes;
5. Coordination of working capital;
6. Improving financial performance;
7. Digitalization and implementation of information technologies.
Within the framework of the transformation strategy and program, the following stages are outlined:
- In 2021-2022. transformation of Uzavtosanoat and its structural enterprises, as well as optimization of current operating activities (corporate governance, production, finance, procurement, sales and after-sales services) and preparation for privatization;
- In 2022-2025, launching production together with partners of new popular car models, as well as halving the time spent on car production, increasing the level of localization, preparing for the production of electric vehicles and gradually selling Uzavtosanoat’s shares in its enterprises to the private sector.