Ford Motor Company Inspects Production at MMK

Specialists from the Ford Motor Company conducted an independent audit at Magnitogorsk Iron & Steel Works to evaluate the process of rolled products manufacturing

The audit involved almost every division of the plant. The Ford Motor Company specialists visited the oxygen converter, the color-coating line, as well as mills No. 5, 10, and 11, which are all involved in production of rolled products for the automotive industry. MMK presented its production capacities and samples of finished products. The Ford team learned about the repair process peculiarities, personnel training methods, input materials and finished product quality control systems operated at MMK.

Upon the completion of the audit, the inspectors noted that MMK is potentially prepared to act as a certified supplier to Ford Motor Company. Among MMK’s strong points they noted the completion and commissioning of the first phase of the Mill 2000 cold rolling complex that is to be equipped with an automated coil inspection unit. The auditors have supported the statistical methods of SPC control that are being introduced at MMK to assess the quality of technologies used at the plant’s key production lines.

The independent audit of the rolled products manufacturing process by Ford Motor Company is part of the MMK program aimed at gaining acceptance of the Company’s rolled products by Russian and international automakers, as well as by manufacturers of household appliances.

According to Boris Dubrovsky, MMK’s CEO: “One of MMK’s strategic goals is to become the leading supplier of steel products to the Russian automotive industry”. MMK has been steadily increasing shipments to domestic automakers. In the first half of 2011, the share of sales to the automotive industry has increased to reach 7.3% of the total MMK shipments to the domestic market. The total sales to Russian automotive factories in 6M 2011 reached 262 kt demonstrating a 35% increase over 6M 2010 and exceeding the volume shipped in 12M 2009.

Increasing sales of steel products to automakers is a result of the commissioning of MMK’s new Mill 2000 cold rolling complex. The first phase of it, mostly intended for production of high-quality automotive sheet, was launched in July 2011 and has a capacity of 2.0 mtpy. Commissioning of the second phase of Mill 2000 is scheduled for 2012.

About MMK

MMK is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company's operations in Russia include a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of higher value added products. In 2010 the company produced 11.4 mln tons of crude steel and 10.4 mln tons of commercial steel products. MMK Group revenue in 2010 stood at USD 7.719 bln, EBITDA at USD 1.606 bln, profit for the period - USD 232 mln.