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The Czechs taught Russian mine workers how to safely transport coal
The export of Czech products is increasing, not only thanks to traditional Škoda cars, beer and glass. In its new serial, the newspaper MF DNES brings stories about entrepreneurs who give work to people and take the results out into the world, just as Ferrit’s partners did who taught Russians how to use modern mining technology. Now Ferrit is approaching other markets with it.
Frýdek – Místek
Ten years ago, the young Czech company taught Russia how to better and more safely transport coal and workers into mines. In 1996, a 3-year-old company from Frýdek-Místek sold to the Russians their first mine trains — not moving on the ground rails but moving suspended on a special ceiling railway line as a cable car.
In the Czech Republic, this type of transport, which is considerably more efficient and safer than traditional ground trains, has been used for almost 25 years. “We have constructed the first suspension system in Russia in 1996 in Zarečnaja mine. People from other mines were coming to take a look at it and we had more and more orders,” says Petr Kovář, managing director and one of four co-owners of Ferrit. Last year, their company produced 58 suspended mine trains and most of them went to the Russian market. It was not easy to persuade the Russians of the benefit of suspended trains. “At the beginning, the Russians did not trust it much and didn’t know it. But they soon realized that the suspended system has lots of benefits compared to traditional ground transport,” says Kovář. “In mines with such transport there are less injuries compared to traditional transport. Suspended trains can even manage much more rugged terrain or a steeper gradient. And when you find out that thanks to the faster and easier transport of supports or other technology you can shorten the period of fitting one tunnel for mining from e.g. two months to 20 days, then that it is worth it,” he explains.
Suspended locomotives are a specialty, and not the only product of Ferrit. This small company with 100 employees also manufactures ground-mine locomotives, loading machines, machines for rock breaking, machines for bending and cutting metal profiles and other technology used in mines. And Ferrit has succeeded abroad with all these.
Ferrit was established in 1993 when three businessmen and one design engineer from a mining technology manufactory Ferrum decided to branch out on their own. “There was no perspective in Ferrum. It was slacking after privatization and in the end it went bankrupt,” recalls Kovář.
They started with what they knew from Ferrum: They were selling mining technology. After two years they concluded that there was no chance without their own products. “Business wasn’t going as well as before. Customers got used to directly contacting the manufacturer and manufacturing companies to selling their products. The role of the agent ended,” he says.
And so one of the four partners of Ferrit, Ivan Pindur, went back to his original profession as design engineer and prepared the design of the first locomotive to be manufactured. The company leased a hall, purchased machinery and started production. Since then, Ferrit has grown continuously. It purchases more halls and takes on more employees. For the past two years, its income has almost doubled to 395 million CZK; profit was almost 16 million CZK. Ferrit invested 15 million — similar to previous years — into new operations. “Thanks to our exports to Russia we are still growing. But we are also selling to Poland, Ukraine, Kazakhstan and Estonia,” says Kovář.
At the beginning, doing business in Russia was difficult even though the people from Ferrit had personal contacts there. “Russian companies didn’t have the money, and so we were exchanging our products for coal or iron. On the other hand, it helped that we knew a number of people there. At that time, business in Russia stood on personal relationships,” says Kovář.
According to him, the situation is different now. The style of work has changed and a young generation of Russian managers — most of whom studied in Western countries- has stepped in. “The main parameters in business are quality and price. Tenders are being organized, and negotiations are harder but more transparent. I welcome this change; we managed to adapt to it,” he says.
A number of other companies from this field of business are also in similar situation as Ferrit. “Privatization manifested itself on the Russian market which is traditional for us. The time when using business contacts from the past, bribes or connections was sufficient has ended,” confirms Jiří Šařec, production manager of Czech CDT, Association of Mine Technology Manufacturers. Nonetheless, there is a number of exporters in this area; from the 15 members of the CDT Association, most are able to successfully export their products. “Up to 90% of their production is sold abroad, mostly in Central and Eastern Europe. But we are looking for new markets, China and South America are especially in our perspective. However, business can be concluded in e.g. Afghanistan too,” says Šařec. The golden business era is slowly ending for manufacturers of mining machinery. Former underdeveloped mines are gradualy equipped with modern technology and the market is becoming full: “We think that our business will grow there at the same speed as now for another five years. In the meantime, we have to find other possibilities. We have presented ourselves in Chile, we have first contacts in Peru and we are preparing for China. Mainly South America looks promising for us,” says Ferrit managing director Kovář.