Hoyo Râşnov to begin tractor production in April

Chinese company Hoyo Râşnov expects to begin tractor production and deliver the first finished tractors on the Romanian market in April, when tractor production is expected to begin, the company"s general manager, Denisa Vasilescu announced. Due to some issues with the assembly units of the plant, the manufacturing of the first tractors has been put on hold since December, initially until January 2010, and now again for April.

"After the completion of the assembly section, we will begin importing parts from China and we will launch production. We intend to produce 3-to 4,000 units a year, and we will adjust domestic production thanks to domestic demand ", Mrs. Vasilescu added.

The Chinese company is interested in joining the "Clunkers" Program, "especially as our products are cheaper than any others found on the Romanian market".

The plant will be producing eight models of tractors, with an output of 25 to 120 HP, with prices starting at EUR 6,500. The Romanian government"s "Clunkers" program will subsidize up to 17,000 lei of the purchasing cost for a tractor, and for 2010, the total value of the program is 21 million lei. For individual farmers, the subsidy may not exceed 50% of the cost of the tractor, whereas for companies and farmers" associations, the maximum subsidized is capped at 40% of the purchase price. As the cheapest Hoyo tractor (25 HP) costs EUR 6,500 (around 28,000 lei) and has virtually no competition, it is obvious that the Chinese producer would be able to absorb all the 21 million lei /year earmarked for this program, which are sufficient for the purchase of 1,235 tractors.

The Chinese producer invested 30 million Euros in Râşnov, and the factory will span 50,000 square meters. Even though it had initially announced it would assemble models with an output ranging between 20 and 120 HP, the Chinese went back on their initial plan and decided to only produce models with an output of up to 30HP, in order to adapt to the specific nature of the Romanian market.