Lexel Makes Itself At Home In City

International concern Lexel, whose headquarters are in Denmark, has organised a domestic electricity parts assembly facility in St Petersburg, but cannot evaluate the project's economic value.

<BR>International concern Lexel, whose headquarters are in Denmark, has organised a domestic electricity parts assembly facility in St Petersburg, but cannot evaluate the project's economic value.<BR>The decision to create a manufacturing base in Russia was taken in June of 1997. In August 1998, Lexel's daughter company, Lexel Electromaterialy (SPb), which markets Lexel's products in the city, began to produce its own goods: sockets and switches.<BR>The total investment in the project (reconstruction work plus assembly equipment) is $3m. About $2m has so far been assimilated.<BR>Locally produced goods make up 25% of Lexel Electromaterialy's total sales. By early 1999 this figure, according to Deputy General Director Dmitrii Kozlov, should rise to 75%. However, Dmitrii Kozlov could not say when the project will break even. In Europe, he said, such projects have recoupment periods of 3-5 years.
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