Likinsk Bus

Analysis of cost reduction and investment optimization potential due to secondary production facilities reorganization.

The Likinsk Bus Plant is a member of Russian Buses division of GAS group and is a modern enterprise, with a technology of big city buses series production.

The company management asked to elaborate economically stated plan of secondary production facilities reorganization of LIAZ. The ALT RC consultants along with the plant specialists conducted the analyses of economic performance of every secondary facility and suggested the optimum reorganization regarding the market, technological and organizational issues. Important focus was made on the right estimation of the reorganization effects of either becoming an independent business unit or trading the facilities assets. The conducted analyses showed that the reorganization would not cut the costs but would minimize the investments necessary for their maintenance. 

In order to compare the two possible scenarios of «letting go how it is» and «implementing the reorganization» ALT RC consultants developed a computer financial model that showed that the company would benefit more if the reorganization was conducted.

On the basis of the project the company conducted the reorganization that had optimized the production and financial performance of LIAZ.