Russia, with its vast territory, rapid urbanization, and large metropolitan areas, holds significant potential for the elevator industry. Growth in the construction sector, an increasing number of high-rise buildings in urban areas, and renovation projects continuously drive demand for elevators.

It is estimated that there are approximately 500,000 elevators in the country, a number that grows annually. Despite the economic challenges affecting the construction sector in 2022, the number of Russian elevator manufacturers did not decline. Moreover, the acquisition of American Otis assets by S8 Capital Holding led to the emergence of a new strong player, METEOR Lift. However, the market faces immediate challenges, such as the rapid localization of components and architectural elements and the expansion of product lines. Regulators are also increasingly considering adjusting the rules for companies’ participation in elevator replacement programs as part of efforts to improve efficiency.

According to the Analytical and Statistical

Committee of the National Elevator Union (NLS), over 40,000 elevators are commissioned annually in Russia. This figure reached 45,890 in 2021 and approximately 44,000 in the previous 12 months.

Challenges Facing the Russian Elevator Industry

One of the most significant challenges for the Russian elevator industry is meeting domestic elevator demand with imported equipment. In 2021, 75% of the installed elevators were produced in Russia, while 12.6% were manufactured in Belarus.

By 2021, Shcherbinsky Elevator Factory (SHLZ) accounted for 20% (9,100 units) of the installation market, followed by American Otis Elevator Company (now METEOR Lift) with 16% (7,200 units), which had manufacturing facilities in Russia. Finnish KONE held third place with a 3% share. Other European manufacturers had even smaller shares, including Swiss Schindler (0.7%, 343 units), German ThyssenKrupp Elevator (1.1%, 526 units), and Greek Kleemann (0.4%, 182 units).

Geopolitical Impact on the Industry in 2022

The geopolitical situation in 2022 caused the "Big Four" — Otis, Schindler, ThyssenKrupp, and KONE — to exit Russia. Domestic manufacturers faced supply chain disruptions for components and architectural elements, affecting equipment production programs. Additionally, the significant increase in construction material costs and declining consumer demand led to a drop in new construction projects.

Despite the downturn, the number of local manufacturers did not decrease in 2022. Russian companies such as Shcherbinsky Elevator Factory, Karacharovsky Mechanical Plant, Siblift, MEL, Evroliftmash, Serpukhov Lift Plant, and Belarusian Mogilevmash remained active. S8 Capital acquired Otis' assets in Russia, including a factory in St. Petersburg and hoist production in Shcherbinka, leading to the creation of METEOR Lift.

Key Issues in the Russian Elevator Industry

At the "Future of the Construction Sector: Challenges and Development Perspectives" symposium in September 2024, a roundtable titled "The Elevator Industry in Russia: From Present to Future" addressed three critical areas: legislation and standardization, production and operation, and education and training.

Participants, including prominent Russian manufacturers such as JSC Moslift, JSC MEL, and Belarusian Mogilevliftmash, highlighted key challenges, such as rising metal costs, a shortage of skilled labor, and a lack of working capital.

Modernization of Aging Elevator Systems

Modernizing outdated Soviet-era elevators represents a significant opportunity for growth. These systems often lack safety and energy efficiency. The Russian government supports modernization through incentive programs, particularly in major cities like Moscow and St. Petersburg, where demand for new elevators in residential and commercial buildings is high.

Rising Material Costs

Increased metal costs have raised elevator production expenses, leading to delays in installation contracts. Average elevator prices rose by 30% in 2022, surpassing 2 million rubles in 2023.

Localizing Component Production

Russia has started initiatives to localize production of essential components, such as frequency converters, which are critical for maintaining smooth elevator operation during voltage fluctuations. METEOR Lift is actively pursuing this and began R&D for domestic frequency converters in 2023 after winning a government subsidy competition.

Skilled Labor Shortage

The industry faces a shortage of qualified engineers and technicians. Training programs need to expand, particularly in collaboration with higher education institutions, to meet the growing demand for skilled personnel.

Opportunities in Modernization and Innovation

Energy Efficiency and Sustainability Energy efficiency is gaining importance in Russia's elevator sector. Modern systems equipped with energy-efficient drivers and innovative technologies aim to reduce energy consumption. Additionally, sustainabilityfocused projects use recyclable materials and low-energy systems to minimize environmental impact.

Integration of Smart Technologies

The adoption of smart building technologies, IoT integrations, and digital elevator solutions will shape the future of the Russian elevator industry. These advancements provide opportunities for local and international manufacturers to meet evolving market demands.

Future Perspectives

The future of Russia's elevator industry is closely tied to the construction sector. Urbanization, the construction of modern buildings, and the renovation of old structures will sustain demand for elevators.

Modernization projects for aging Sovietera elevators represent a significant growth opportunity. Additionally, governmentbacked programs aim to accelerate the transition to safer, energy-efficient systems, benefiting manufacturers, service providers, and the broader industry.

Investments in innovation and technological advancements will be crucial for domestic manufacturers to capitalize on these opportunities. At the same time, imported brands will continue to find space in the Russian market, fostering competition and innovation.

In summary, the Russian elevator industry holds substantial growth potential, with modernization, energy efficiency, and sustainability offering new opportunities. By embracing innovation and addressing challenges such as labor shortages and component localization, the sector is poised to thrive in the coming years.