Germany’s BLG Logistics has signed a joint venture agreement with Russian transport and logistics provider Fesco to develop automotive port handling operations at the port of St Petersburg and truck distribution within the Russian market.
The joint venture will make an initial investment of €10m in the project including the development of facilities at St Petersburg with stevedore JSC Sea Port of Petersburg over a 95,000m2 area. The investment will also include a fleet of 31 vehicle trailers.
Projected annual throughput volumes of 60,000 units are expected at the port in 2011.
The news comes as the latest new car sales figures for Russia from the Association for European Businesses show a 26% year-on-year rise in September touching 48,500 units
The AEB is forecasting a 28% rise in full year 2011 sales to 2.45m.
Fesco’s president and CEO, Sergey Generalov, said the joint venture would offer clients attractive automotive logistics services and develop into one of the leading players on the Russian market within five years. He also said the company would combine ocean transport and port handling of vehicles in the European part of Russia and in the Far East with rail and truck transport of both imported and locally assembled vehicles.
Fesco has an extensive network of ocean, rail and road transport, including port and inland infrastructure for container, cargo and vehicle movements in Russia. It has annual capacity for 100,000 vehicle units.
Both companies are eager to gain from the Russian automotive market’s growth forecast, which is estimated to grow at an average of 15% per year.
Detthold Aden, chairman of the management board of BLG Logistics, added that the combination of Fesco’s deep knowledge of the local market and diversified portfolio of assets and services, along with its push for innovation, made it a perfect match for BLG’s strong position in the Europe to Russia trade.
BLG Logistics recently signed another joint venture with the Chinese supply chain provider Cinko SCM to jointly operate a PDI centre at the port of Tianjin’s ro-ro terminal. The new company is called BLG Cinko Autotec. Read more here