VII International forum
“Marine Industry of Russia”
Hotel complex
«President-Hotel»
Department of affairs of the President of the Russian Federation

Moscow, 24, B.Yakimanka Str
24-25 May 2017
 
Forum bulletin


More on river and sea navigation companies

The majority of Russian navigation companies was founded in the end of the XIX century. Then, ships were driven by steam-engines and navigation companies coordinated ships’ running by ensuring free navigation by rivers, capability of handling operations and goods storage, etc. Bit by bit, the infrastructure was developing, covered storehouses and ways emerged, hydraulic engineering structures and places for winter parking were constructed. The ports turned into complex advancing facilities. And navigation companies’ functions grew more difficult.

Main Tasks of Navigation Companies

In the context of the market, the main task of transport enterprises is to satisfy customers’ transportation needs in time and full extent and profit making. To this end, there is the marketing service of the navigation company monitors situation, searches for prospective clients among domestic and foreign companies and entrepreneurs.

For some Russian navigation companies, ship passage under the Russian flag is one of the most important and top-priority tasks.

Amid the economic crisis, navigation companies’ management has to change their work. At that, the survival is conditioned mainly by maintaining the predetermined pace of the company’s development as well as by providing effective advance in the context of upgrading existing and constructing new fleet.

The navigation company with all-purpose fleet can afford to strategically respond all freight market changes and fight in searching for a freight base.

Another important point is development of new activities, since as predicted by specialists, year 2010 will not be a calm and easy year for Russian navigation companies. Post-crisis shipping market rehabilitation will not be fast.

Sea Navigation Companies

Marine transportation in Russia is one of the prospective spheres. Opportunity for growth are provided mainly by development of the external commerce, to begin with raw material export.

70% of marine transportation on the Russian market is ensured by efforts of seven largest companies:

  • OJSC Sovkomflot;
  • OJSC Novorossiysk Shipping Company (Novoship);
  • OJSC Far East Shipping Company (FESCO);
  • OJSC Murmansk Shipping Company (MSCO);
  • OJSC Northern Shipping Company (NSC);
  • OJSC Primorsk Shipping Company (PRISCO);
  • OJSC Sakhalin Shipping Company (SASCO);

River Navigation Companies

The worldwide trend of cargo traffic redirecting towards using the water transport, governmental support and active implementation of programmes provided by the transport strategy of the Russian Federation for improvement of the river transport effectiveness and its integration into the international transport system increase efficiency of investments into river transport enterprises.

For some river navigation companies, the area of the highest priority is construction of cruise fleet.

Investment Activity of the Russian Navigation Companies

Comparing to foreign navigation companies, Russian ones are underestimated in their majority. Even if we do not take into account their growth opportunities. The main investments risks are related to corporate management and low level of transparency. To resolve the situation, the consolidation of the industry and IPO of some companies are necessary.

The most attractive investment objects are shares of Novoship, Murmansk Shipping Company and Fesco Transportation Group.

Integrated Management System for Navigation Companies

Today world companies, regardless their scale and affiliation to the industry, meet a number of such problems as market volatility, growing competition, pressure of various social institutions. All these considerably complicate management of operational and economic risks. To solve these problems, Russian navigation companies apply integrated management system efficient in synchronization of all management processes and provision of programmed quality thus enhancing company reliability and prestige as well as creating its competitive advantage on the freight market.

 
 
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