‘AutoVAZ has been trying to raise its efficiency by cutting expenses, a great part of which is made up by the price of the metal. This automobile concern has a number of suppliers to choose from, this is why it feels it can write its own ticket as far as Metallurgical Industrial Complex of Magnitogorsk is concerned. It is the Complex that will have to compromise, otherwise it will lose a very important client,’ the expert of FINAM Investment Company Sergey Filchenkov said to UrBC representative, following the recent refusal of the carmaker to use the Complex as their supplier.

‘If the parties do not negotiate a treaty in the end, Metallurgical Industrial Complex of Magnitogorsk will experience a short-term decrease in sales. This will lead to an overall loss of 300-350m RUR per month,’ Mr Filchenkov observed.

‘The Complex will need some time to find new orders, and the new customers are highly likely to be relatively small businesses, which means cooperating with them will require a lot of transactional expenses. The company will also have to spend a bit on marketing. As for AutoVAZ, it could always redistribute the orders previously placed with the Complex among other supplier, for example, SeverStal and Metallurgical Industrial Complex of Novolipetsk,’ he said.