PLANNING, PROCUREMENT, AND SUPPLY IN THE TANK AND ASSAULT GUN INDUSTRY OF THE USSR

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-01093A000700110005-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 36
• Document Creation Date: November 9, 2016
• Document Release Date: March 3, 1999
• Sequence Number: 5
• Publication Date: December 20, 1954
• Content Type: REPORT

Release 1999/09/08 :CIA-RDP79-01093A000700110005-5
US OFFICIALS ONLY
PROVISIONAL INTELLIGENCE REPORT
PLANNING, PROCUREMENT, AND SUPPLY
IN THE TANK AND ASSAULT GUN INDUSTRY
OF THE USSR,
CIA/RR PR-89
20 December 1954
COCUMENT NC).
NO CHANGE IN OLASS. C7
0 DECLASSIFIED
CLASS. CHANGED TC): 73 .
NEXT REVIEW DATE:
RUTH: : 91469 REVJEWER: 008514
CENTRAL INTELLIGENCE AGENCY
OFFICE OF RESEARCH AND REPORTS
RETURN TO ARCHIVES k RICW CE
IMMEDIATELY AFTER USE
JOB BOX US OFFICIALS ONLY
Approved For Release 1999/09/08: CIA-RDP79 01093,A0 i a5,5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
WARNING
This material contains information affecting
the National Defense of the United States
within the meaning of the espionage laws,
Title 18, USC, Secs. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/0 93A000700110005-5
bW
US OFFICIALS ONLY
PROVISIONAL INTELLIGENCE REPORT
PLANNING, PROCUREMENT, AND SUPPLY
IN THE TANK AND ASSAULT GUN INDUSTRY OF THE USSR
CIA/RR PR-89
(ORR Project 31.213)
NOTICE
The data and conclusions contained in this report
do not necessarily represent the final. position
of ORR and should be regarded as provisional only
and subject to revision. Comments and data
which may be available to the user are solicited.
US OFFICIALS ONLY
((/p(~pFlDENTlAL
Approved For Release 1999/09'IO' CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/OCOV- 3A000700110005-5
Summary and Conclusions . . . . . . . . . . . . . . . . . . . . . 1
I. Planning . . . . . . . . . . . . . . . . . . . . . . . . . 3
A. Planning for Armaments Production . . . . . . . . . . . . 3
1. Armored Fighting Vehicle Planning . . . . . . . . . . 4
2. Consumer . . . . . . . . . . . . . . . . . . . . 5
3. Producer . . . . . . . . . . . . . . . . . . . . . . 5
B. Preparation of the Plan . . . . . . . . . . . . . . . . . 6
C. Technical-Production-Financial Plan . . . . . . . . . . . 7
1. Technical Plan . . . . . . . . . . . . . . . . . . 8
2. Production Plan . . . . . . . . . . . . . . . . . . . 8
3. Financial Plan . . . . . . . . . . . . . . . . . . . 9
II. Procurement . . . . . . . . . . . . . . . . . . . . . . . . 9
A. Material Balances . . . . . . . . . . . . . . . . . . 9
B. Procurement System . . . . . . . . . . . . . . . . . . . 10
1. Funded Commodities . . . . . . . . . . . . . . . . . 10
2. Quota Commodities . . . . . . . . . . . . . . . . . . 11
3. Decentralized Supply . . . . . . . . . . . . . . . . 11
C. Procurement Process . . . . . . . . . . . . . . . . . . . 11
1. Organization . . . . . . . . . . . . . . . . . . . . 12
2. Planning . . . . . . . . . . . . . . . . . . . . . . 12
3. Economic Contracts . . . . . . . . . . . . . . . . . 13
III. Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
A. Specialization and Regional Self-Sufficiency . . . . . . 14
1. Northern Region . . . . . . . . . . . . . . . . . . . 16
Approved For Release 1999/09/08 : C"pVg WA400700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
Page
2. Southern Region . . 01 . . . . . . . . . . . . . 17
3. West Siberian Region . . . . . . . . . . . . . . . . 17
4. Urals Region . . . . . . . . . . . . . . . . . . . 18
5. Far Eastern Region . . . . . . . . . . . . . . . 19
C. Transportation Requirements . . . . . . . . . . . . . 20
IV. Vulnerabilities and Intentions . . . . . . . . . . . . . . . 21
A. Vulnerabilities . . . . 21
B. Intentions . . . . . . . . . . . 21
Appendixes
Appendix A. Methodology . . . .. . . . . . . . . . . . . . . . . 23
Appendix B. Gaps in Intelligence; . . . . . . . . . . . . . . . . 25
Appendix C. Sources and Evaluation of Sources . . . . . . . . 27
Approved For Release g
' 08 CCIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08: CIA-R P7 01093A000700110005-5
^r%%FJ - __ _T11C
cIA/RR PR-89
(ORR Project 31.213)
PLANNING, PROCUREMENT, AND SUPPLY
IN THE TANK AND ASSAULT GUN INDUSTRY OF THE USSR*
Summary and Conclusions
The long lead time inherent in the production of modern weapons
and the limitations of time and space lead to the primary tenet of
Soviet armaments planning; the military equipment to be used to ex-
pand the Soviet armed forces to their maximum size must be produced
before mobilization and not subsequent thereto. The practical effect
of this basic planning principle on the armaments industry in general
and on the tank and assault gun industry in particular is that, once
the desired levels of equipment for active units and equipment reserves
for inactive units are reached and the material is stored in the depots
of the various military districts, the industry can engage in a planned,
long-range production program of known proportions and constant volume,
which is calculated to compensate for technical obsolescence and
physical deterioration. The tank and assault gun industry can achieve
this goal with an annual allocation of some 20 percent of its total
industrial capacity to the production of military hardware.
Initial planning of the program for the production of tanks and
assault guns is the primary responsibility of the direct consumer, the
Main Administration for Tank and Mechanized Forces of the Ministry of
Defense. This organization is charged with responsibility for the pro-
curement, storage, issue, and maintenance of all armored vehicles and
is in close liaison with the producer, the Main Administration for Tank
Construction of the Ministry of Transport Machine Building. Intelli-
gence analysis suggests a 10-year manufacturing cycle in this field,
with the design, development, and testing task contained in one
5-year plan, and the serial production task set forth in the following
5-year plan. There are, of course, variations from this theme because
of varying lead times, priorities, and the number of a particular model
needed. Practical and technological considerations demand that
* The estimates and conclusions contained in this report are those of
the responsible analyst as of 1 September 1954.
C4NFIDENTfAL
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
armaments planning, procurement, and supply be closely integrated
with the rest of the economy. Of necessity the operation procedures
followed. in the tank and assault gun industry do not differ materially
from those followed by the other machine-building industries. The
5-year plans which set the guide assignments are, in a sense, strategic
in nature. It is the operational annual plan and the tactical quar-
terly plan which constitute the hard core of Soviet economic planning.
Preparation of the Plan for 1954 was accomplished as follows. On
the basis of past production data, as well as information from other sectors
of the economy, the Council of Ministers proposed goals for 1954. In
general, these goals were based on the framework of the current Five
Year Plan, although changes such as the so-called "new course" are
not without precedent. On the basis of these stated goals for 1954,
Gosplan and the Main Administration for Tank Construction simul-
taneously initiated the preparation of draft plans. The former
agency was concerned with the over-all economy, while the latter con-
cerned itself with its own subordinate plants. The Main Administra-
tion's draft plan was submitted to its plants for comment and estimates
concerning the raw materials, components, and new production equipment
needed to fulfill the draft plan. The Main Administration's draft
plan, as amended, was then returned through channels to Gosplan, which
reconciled all such draft plans with its own. The composite final
draft plan was then submitted by Gosplan to the Council of Ministers
for approval, and the Final Plan for 1954 was then redistributed
through channels, each echelon amending its draft in accordance with
the Final Plan. This process normally consumes 4 to 5 months. On
the basis of the Final Plan, each tank plant adjusted its 195+
Technical-Production-Financial Plan, which controls the operation of
the various departments, divisions, and staffs of the plant.
The Supply Plan for each tank plant is, of necessity, part and
parcel of the procedure outlined above; the general supply program is
outlined in the Plan. Under the Soviet system, all supplies are
secured either through centralized or decentralized distribution.
Centralized distribution is a system of direct commodity allocation
which contains two categories: funded commodities and quota commodi-
ties. Funded commodities may not be disposed of by the producer but
are distributed to a specific consumer for a specific purpose only
upon the direct order of the Council of Ministers. Quota commodities
are those which, within the structure of the approved Plan, are
allocated by the principal ministry producing the commodity. De-
centralized supplies are not centrally controlled, although prices
S -E-C -R--E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09108 : CIA-RDP79-01093A000700110005-5
S -E-C -R-E-T
are fixed. The planning mechanism outlines what the tank plants and
their suppliers are to produce and who will consume the products. The
system is formally tied together and put into operation by means of
legal contracts. The Main Administration for Supply of the Ministry
of Transport Machine Building, to which ministry the Main Administra-
tion for Tank Construction is subordinate, negotiates a general con-
tract with the Sales Directorate of a supplying ministry. On the
basis of this general contract the tank plants negotiate, with the
supplying plants of the other ministry, individual local contracts
covering specifications and delivery dates.
The tank and assault gun industry consists of b Final assembly
plants, 41 prime subcontractors, and some 200 secondary subcontractors,
or about 250 separately administrated installations. By way of con-
trast, 1 tank assembly plant in the US has some 12,000 suppliers.
Soviet authorities recognize the value of this product specialization
and are increasing the number of specialist component plants. They
insist, however, that each tank assembly plant be as regionally self-
sufficient as possible. At the present time there are four such
regions; the Northern region, centered at Leningrad; the Southern
region, centered at Kharkov; the Urals region, centered at Nizhniy
Tagil, Sverdlovsk, and Chelyabinsk; and the West Siberian region,
centered at Omsk.
I. Planning.
A. Planning for Armaments Production.
The fundamental feature of Soviet heavy industry in general
and of the tank and assault gun industry in particular is the
planned nature of its operations. The task of planning for Soviet
armaments production consists of anticipating the equipment require-
ments of not only the forces in being but also the forces which would
come into being under the terms of the Mobilization Plan. Once these
requirements are established, Soviet industry will produce sufficient
quantities of military end items to meet them. When these require-
ments are quantitatively satisfied, the planning objective becomes
that of the maintenance of these stocks both in the hands of troops
and in the military reserve system. The problem of maintenance has
-3-
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C -R-E-T
both qualitative and quantitativ6 aspects. Armament planning must
provide for the replacement of weapons lost to physical deterioration
and of those rendered obsolescent by technical progress.
This maintenance programlrequires, therefore, that large
stocks of weapons be maintained which may be technically inferior at
any given point in time to the 1ktest developments in these weapons
by other nations. It may be pointed out, however, that this appar-
ent deficiency in the Soviet system is compensated for by the fact
that since these weapons are always present in large numbers (full
TO/E*), there is not the sudden iecessity to produce the weapons to
full level of TOE starting witha prototype model or, perhaps, even
less.
At the conclusion of World War II the USSR had large stocks
of weapons on hand in its armed forces, and therefore a large part
of the production to meet quantitative requirements had already been
met by the end of the war in 1945. The planning tasks since that
time, therefore, have been largely those of combating the deteriora-
tion of existing stocks of weapons and providing for the replacement
of those weapons rendered technically obsolescent by late-war and
postwar developments in technology.
1. Armored Fighting Vehicle Planning.
The manufacture of weapons is a complicated process which
reaches into virtually every segment of the industrial economy. The
production of armored fighting vdhicles (AFV's) requires steel, coal,
aluminum, rubber, optics, plastids, electrical equipment, and a host
of other products. /** It is a arent that AFV production cannot
operate in a vacuum but must be integrated with those other products
which are a part of the Soviet planning system. From the point of
view of procedure, planning for the production of AFV's does not differ
radically from the planning for any other machine.
Events have indicated that Soviet armament planning since
the war has followed guide assignments set forth in the 5-year plans
and that actual production performance has been based on the more
closely controlled annual plans.' The time periods involved in re-
search, development, acceptance, 4nd mass production of a particular
* TOE is a standard US Department of the Army abbreviation of the
term "Table of Organization and Equipment."
** Footnote references in arabic' numerals are to sources listed in
Appendix C. I
S -E'-C -R-E -T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
weapon vary with the lead time required, the priority assigned, and
the quantitative size of the demand. Available evidence indicates
that the first postwar 5-year plan (the Fourth Five Year Plan,
19+6-50) set the task of designing, developing, and testing new AFV
models, and there is abundant evidence that new models were in fact
created during that time. The task of the current Plan (the Fifth
Five Year Plan, 1951-55) has therefore become one of production of
sufficient quantities of these new AFV models to replace the
technically obsolete, earlier models which date back to the closing
years of World War II.
Procurement of AFV's for the Soviet armed forces is the
specific responsibility of the Main Administration for Tank and
Mechanized Forces..?/ This Main Administration is directly re-
sponsible to Ground Troops Headquarters, which in turn is subordinate
to the Ministry of Defense. J The Main Administration for Tank and
Mechanized Forces is responsible for all aspects of armored warfare.
It develops doctrine, conducts specialized training in the field, and
operates schools for the instruction of army officers. / It
participates in the AFV research and development program and is re-
sponsible for the procurement, storage, issue, and maintenance of
such equipment as falls within the purview of this organization. J
3. Producer.
Production of AFV's for the Soviet armed forces is the
specific responsibility of the Main Administration for Tank Construc-
tion, which is subordinate to the Ministry of Transport Machine
Building. J Subordinate to this Main Administration are the
various manufacturing plants which produce and/or contract for the
various components, which when assembled are delivered as complete
AFV's to the consumer, the Main Administration for Tank and Mechanized
Forces. The plants subordinate to the Main Administration for Tank
Construction are the following: (a) Leningrad Heavy Machine Building
Plant No. 185 imeni Kirov; (b) Chelyabinsk Tank Plant No. 100 imeni
Stalin; (c) Nizhniy Tagil Urals Tank Plant No. 183 imeni Kaganovich;
(d) Kharkov Transport Machine Building Plant No. 75 imeni Komintern;
(e) Omsk Machine Building Plant No. 174+ imeni Voroshilov; and
(f) Sverdlovsk Tank Plant No. 50 (part of "Uralmash" complex). J
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E--C -R-E-T
B. Preparation of the Plan.!
The magnitude of the task of planning the Soviet economy
challenges the imagination. It is a tremendous undertaking. The
over-all plan must be conceived dnd drawn up by central authority in
order to insure that the objecti-tes of the state receive the desired
emphasis. Central planning is necessary to insure internal consis-
tency of the plan. J At the sale time, if the plants which must do
the work had no voice in the preparation of the plan, it would tend
to be unrealistic and unworkable with impossible tasks given some
firms and genuine opportunities missed by others. The problem is
recognized by the USSR as the need for "planning from above and
below." J It is evident that the 5-year plans provide general
guidance toward long-range objectives and that specific production
requirements are set forth in the annual plans. 10 To illustrate,
it is assumed that the Fifth Five Year Plan contained the general
goal of replacing the existing p .rk of medium tanks -- T3, T3LI./85,
and T44 -- with the more modern T-54 tank. While this would be the
primary or priority assignment of the Main Administration for Tank
Construction, the Plan would be doncerned with many other industrial
products as well. The subordination of the tank plants to the Main
Administration for Tank Construction is prompted by the nature of
their primary production (AFV's), which at the present time occupies
only some 20 percent of their capacity.*.11
The preparation of an annual plan for the tank and assault
gun industry is generally carried out as follows. On or before
1 October of the year preceding the year for which the plan is being
made, producing plants of the Main Administration compile in-
dustrial data for the first 3 qu&rters of the year and. make estimates
for the fourth quarter of the year. 12 This information is forwarded
through and collated by the Main!Administration for Tank Construction
and the Ministry of Transport Machine Building before being sent to
the Council of Ministers. 13 On the basis of an over-all view of the
economy obtained from this as well as similar information from other
sectors, the Council of Ministers sets forth the specific economic
* The percentage would vary with the method used to estimate capacity
such as assembly line capacity, metallurgical capacity, or tons of
finished metal per year. The USSR uses assembly line capacity in a
plant of this type.
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
tasks of the 1954 plan based on the general objectives of the Fifth
Five Year Plan. 14 Such things as changes in relative priorities,
the introduction of new products, solutions to problems arising during
the current year, advances in technology, and the approximate increase
in output are proposed. 15 On the basis of these instructions,
planning is simultaneously undertaken by Gosplan (the planning staff
agency of the Council of Ministers) and by the Main Administration for
Tank Construction. 16 The emphasis in the Gosplan activity is, of
course, on the reconciliation of the activities of the various sectors
of the economy into a single, internally consistent national plan,
while the Main Administration for Tank Construction is primarily con-
cerned with AFV problems. The Main Administration draws up a first
draft of its plan and distributes it to its subordinate plants for
comment. 17 They in turn draw up schedules of raw materials, addi-
tional capital equipment, and the like, needed to carry out their part
of the draft plan and submit these together with any modifications,
suggestions, or objections to the Main Administration. 18 The amended
draft is then forwarded by the Main Administration through. the
Ministry and again via the Council of Ministers to Gosplan, which rec-
onciles the draft with its own and draws up a composite final draft
for submission to the Council of Ministers for final approval. L9/
When such approval is obtained, final plans for the planned year are
redistributed through channels to the Ministry, the Main Administra-
tion, and plants. 20 The initial draft is revised at each level on
the basis of the final plan, with each revision approved by the next
higher echelon. 21
C. Technical-Production-Financial Plan.
Generally speaking, the annual plans set forth what is to be
done in broad terms and cover such items as (1) the quantity, quality,
and variety of items to be produced; (2) capital expenditures
to be made in terms of machinery to be purchased or main-plant units to
be constructed; (3) labor in terms of the total number of workers, the
wage scale of each class, and the desired percentage increase in labor
productivity; (4) percentage reduction in costs to be attained;
(5) the amounts of raw materials, semifinished articles, and equipment
which have been allocated to the plant; and (6) the financial arrange-
ments by which the plant is to conduct its business., given in terms
of working capital, method for financing capital construction, and the
like. These planned goals represent the general pattern of what is to
be done. It remains for the producing plant to define how these tasks
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
are to be accomplished through its own Technical-Production-
Financial Plan (Techpromfinplan). 22
The Techpromfinplan follows the same outline as the annual
plan described above but goes ino sufficient detail to outline the
activities of each division, dep~rtment, and other subunit of the
plant. 13/ A brief discussion or each of the three parts of the
Techpromfinplan is useful. I
1. Technical Plan.
For the tank plant, the technical plan deals with
technical efficiency, implementation of technological advances,
plant maintenance, intraplant transportation, and the like. It
outlines current deficiencies in4plant operation and lays down the
course of action to be followed tin overcoming those deficiencies. 2V
For example, the wartime installation of moving-conveyor assembly
lines in the tank plants was hanldled in this section of the plan.
The production plan of the plant subdivides the produc-
tion tasks received from the Main Administration into four major
product categories 25/: basic production, production based on orders
from cooperating enterprises (as' explained below), decentralized pro-
duction, and other production.
Basic production co
which in the instance of AFV pl
item of civilian production suc
stitutes the plant's specialty,
nts is both the basic AFV and some
as railroad cars.
Production based onlorders from cooperating enterprises
refers to a special type of pro uction relationship established
between plants by plan. 26 Cooperation, in this sense, in the ma-
chine-building industries has a$sumed sizable proportions and takes
two main forms 27/: (a) production of component parts for other
plants producing finished machines and (b) cooperation between
plants producing the same or siiilar products. In the case of the
AFV plants, this type of cooperation may take the form of the pro-
duction of large castings for other ministries, since the AFV
plants' equipment is well suited to this production, or it could
take the form of technological cooperation, in which skilled labor
and technical personnel are lent to other plants for the purpose of
instituting a new production method or other improvement.
S+E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S -E -C -R -E -T
Decentralized production is that production which is
destined to local organizations. An example of this type of produc-
tion is the output of pots and pans from the plants' scrap ma-
terials. 28
Other production includes such job-lot services as the
repair of farm machinery.
The production plan takes the form of an operational
program which may be based on a 10-day period, month, or
quarter. 29 In establishing production schedules for this
operational program, the plant must determine the calendar priority
for the production of different products in order to guarantee timely
fulfillment of orders. 30 According to established procedures,
orders from the Main Administration for Tank Construction must reach
the plant not later than 10 days before the first of the month, so
that the production schedule for the following month may be prepared
in time. 31
3. Financial Plan. 32
The financial plan sets up a program for the receipt
and expenditure of funds involved, in the carrying out of the produc-
tion plan. The plant's funds are maintained in an account with the
State Bank (Gosbank), which acts as a clearinghouse for transactions
between plants, chief directorates, and ministries. The plan speci-
fies expenditures to be made; the size of the labor force to be
employed, including a breakdown of the force by skills; and the wage
fund from which wages and salaries are to be paid. 33 The planned
cost of production is calculated through the use of coefficients of
utilization, that is, ratios of inputs to planned output. 34+
Deviations from this plan are made only at the risk of disruption
of the over-all plan, and changes in it are assiduously avoided.
II. Procurement.
A. Material Balances.
A central role in the planning of the operation of the
national economy is played by the system of national material
balances (material'nye balansy). A material balance for any
commodity serves to equate planned supply with a planned distribu-
tion schedule. On the supply side, there will be specific carry-
-9-
S -E-C -R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-g-C-R-E-T
over inventories, planned production, planned imports, and the like.
The material cost to the economy of this planned production is worked
out in detail. The distribution 6chedule will indicate amounts to
go to production, construction, direct retail sales, exports, and state
reserves, and will be accompanied?by the necessary set of norms speci-
fying the amount of further product to be expected from the use of the
material. 35 Of late the detailed distribution schedule has come to
be referred to separately, and it now frequently happens that refer-
ence is made to the "material balances and distribution schedules." 36
Since 1934, these material balances have been made up by Gosplan.* 37
Since these material balances require prodigious quantities
of work in their preparation, they were originally made up for only a
few items. Even as late as 1941 they covered only 450 items, 300 of
which were raw materials and fuels. 38 By 1951 they covered 1,600
commodities. 39 The commodities so cove-red are the so-called
"funded commodities," 40 40/ dealt with at greater length below. They
include (1) the basic raw materials for agriculture, for industry,
and for construction; (2) all of the basic fuels and energy sources;
and (3) all of the important industrial finished units, such as
motor vehicles, locomotives and freight and passenger cars, agri-
cultural machines, metalworking machines, and construction ma-
chines. 41
B. Procurement System.
Under the Soviet system, all goods and materials, whether
producer goods or consumer goods, fall into 1 of 3 classes. The
first two classes are centrally allocated. The third class -- goods
which can best be handled locally and are of a lesser over-all
importance -- is handled by decentralized supply. 42
Funded commodities are those which are distributed by
direct order of the Council of Ministers in quantities and for
purposes fixed in advance by the plan. They are those for which
the Council of Ministers and its staff agency, Gosplan, approve
annual and quarterly material balances and distribution sched-
ules. 43 The assignment of funded commodities is usually to a
main. fund holder. 44 In the case of AFV's, it is believed that
* During the existence of Gossnab (1948-March 1953) they were
made up by Gossnab.
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S -E-C -R-E-T
the Main Administration for Tank Construction is the main fund holder,
being allotted given amounts of funded materials and equipment for
precisely specified purposes. These supplies are not confined to those
needed for the manufacture of tanks but also include material for the
production of other items by the Main Administration, depending on the
type and priority of that product. The Main Administration,in turn,
divides this fund among the various plants subordinate to it. Thus,
under the funded supply system, each plant has a definite allotment
for each quarter and for the year as a whole. L5/
2. Quota Commodities.
Quota commodities are also handled by a centralized
allocation. They are, however, goods of less importance and in less
short supply than the funded commodities. Allocation is made by the
principal producing ministry rather than by the Council of Ministers.
Allocation is made in the form of a quota. Delivery is made by a
producer to an individual user, provided the quota allotted to the
user's industry, region, or plant has not been exceeded. The purpose
for which the user wishes the material need not be specified to the
producer in advance. ~+6
3. Decentralized Supply.
Products in decentralized supply channels come largely
from local and republic industries which are not directly under the
control of the All-Union economic apparatus and consist of such
things as agricultural products, the output of handicrafts, and cer-
tain local building materials. 4+7 If they are produced by All-
Union ministries, supplies may be allocated to each region and there
sold to firms in accord with the suggestions of local planning in-
stitutions. 48/ Or they may be bought up by supply and procurement
organizations of consuming ministries and Main Administrations for
subsequent sale to their own firms. 49 Other decentralized goods
may be sold directly by the production plant to other firms. 50
C. Procurement Process.
It is obvious that procurement planning must be carried out
simultaneously with production planning. What is a matter of pro-
curement with one organization is a matter of production with
another. There exists, however, a parallel and highly integrated
correlation between the mechanism for production and that for pro-
curement.
S -E-C -R -E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
1. Organization.
Each industrial ministry, including of course the Ministry
of Transport Machine Building, hap a Main Administration for Supply
(Glavsnab). 51 This Main Administration is responsible for planning
the composite needs of the various production organizations in the
Ministry, for example, the Main Administration for Tank Construc-
tion. 52 Further, within the Main Administration for Tank Construc-
tion, there is a Directorate of Supply which, in turn, is responsible
for planning the composite needs of the tank plants, which, as in-
dicated, are producing many things in addition to tanks. ! Each of
these different supply organizations is responsible, each on its own
level, for defending its composite supply plans before higher bodies,
for distributing allotments of centrally allotted goods to the proper
consignee, and for helping in the actual purchase of such supplies. 54+
In spite of these supply organizations, each tank plant
must do a great deal of its own procurement directly, if results are
to be obtained, 55 and the emploment of plant representatives called
"pus:hers" is a common practice. 56/
2. Planning.
Just as production planning has its aspects of planning
from above and below, so too has the planning of procurement. The
tank plant presents both annual and quarterly statements of its re-
quirements for centrally distributed goods to the Main Administration
for 'Tank Construction. 57 The Directorate of Supply of the Main Ad-
ministration for Tank Construction amalgamates the statements of
needs from the various tank plantt into the coordinated statement of
the needs of the Main Administration, which is then forwarded to the
Main Administration for Supply ofithe Ministry of Transport Machine
Building. This Main Administration, having coordinated and amalgamated
the requirements of the operating; Main Administrations to the
Ministry, submits its combined procurement plan to the State Planning
Commission (Gosplan, now incorporating the former Gossnab) and to
the Council of Ministers. 58 These statements show the quantity
and quality of raw materials, semtfabricated goods, and fuels re-
quired. 59 Thus, while the allocation of supply is from the top
down, firms and even plant departients have some voice in it. The
procurement plans for the variousIministries are coordinated and
brought into final form by Gospla.. After approval by the Council of
S -E fC -R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
Ministers, the final plan is then issued to the Ministry, and through
the Ministry to the Main Administration, which in turn advises the
plant what materials it is to receive. 60 The buying enterprise
must then proceed to make contracts according to which its allotted
supplies will actually be delivered by producing or by marketing
organizations.
3. Economic Contracts.
Daring the period 1935 to 1950 the basic form of con-
tractual relationship was the direct contract between the parties
immediately concerned with the fulfillment of planned obligations. 61
Under this system, however, the various main administrations of
supply, trusts, and other sales, supply, and procurement organizations
which were administratively interposed between the contractual parties
were not legally and financially responsible for contract violations,
even though such violations were directly attributable to them. 62/
This situation was altered by Decree No. 1586 of the Council of
Ministers, dated 21 April 1949, which reintroduced the system of
general and local contracts which prevails today. 63
The general contract is one which is concluded according
to plan between the responsible in Administrations of Supply and
consumer ministries. The general contract contains general provisions
for the procedure and dates of submitting specifications and official
orders and spells out the nature of contract relations between
specific suppliers and consumers, with specific indications as to
which plants will conclude local contracts. 64+
Local contracts are merely a refinement of the general
contract. They are concluded between the individual plants which
actually produce and consume the goods which are the subject of the
contract. They are concluded after the general contract has gone in-
to effect and serve to give more precise definition to delivery terms,
dates of delivery. quality of the goods, price, accounting procedures
to be followed, and consequences of contract violations. 65
III. Supply.
Because of the planned nature of the economy of the USSR, there
are many elements inherent in the supply structure of the AFV in-
dustry which make for a highly efficient supply network, capable of
rapid conversion and expansion. Since the production of tanks and
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
other armaments is based on the long-range 5-year plans, the annua_
flow of materials and components for such production is constant,
continuing, and generally even ih volume. There are not the abrupt
and radical changes which constantly alter supply networks in the US.
Furthermore, since the suppliers are designated by central authority
at the same time that the decision is made to produce the tanks,
there is no need for the assembly plant to locate potential component
suppliers and then compete in an open market for their services.
The AFV industry is capable of extremely rapid conversion to the
capacity production of some 40,000 vehicles per year. 66 This cap-
ability is the result primarily of the highly developed mobilization
reserves system. Just as the planning for current production of AFV's
is centralized, so also is the mobilization. 67 These current com-
ponent suppliers are desi 7 ated to continue this supply at increased
volume in case of war. 68 To that end, the necessary machinery for
conversion of the plants to full production of AFV parts is located
in sealed warehouses at the plant. 69 Furthermore, a supply of raw
materials and semifabricated goods is stored on the plant premises,
thus enabling the plant to convert immediately upon receipt of the
mobilization order and to operate for a period of three or more
months without recourse to its subcontractors. 70 The advantages
of this supply structure and organization are manifest. It permits
the uninterrupted design, testing, and production of AFV according
to a long-range plan; it permits the strategic dispersal of manu-
facturing and parts plants in such a manner as to insure their best
utilization with a minimum of improvisation and inefficient use of
transportation in both cold and hot war periods, and it permits the
extremely rapid expansion of production. Its disadvantage lies in
the great expense of perpetuating such a system.
A. Specialization and Regional Self-Sufficiency.
One of the outstanding characteristics of the Soviet AFV
industry as contrasted with the US industry is the small number of
separate installations involved.. In addition to the 6 final assembly
plants which have been previously mentioned, there are believed to be
some 41 prime subcontractors who, in turn, have an estimated 200
secondary subcontractors, for a total of some 250 installations com-
prising the entire industry. By way of contrast, the tank plant in
Cleveland, Ohio, which is operated by the Chrysler Corporation, had at
S -E-C -R-E -T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S -E -C -R -E -T
one point some 3,000 prime contractors who, in turn,,had 9,000 sub-
contractors located in 23 states. 71/ The Soviet tank assembly plants
are large complexes which perform themselves a large portion of the
work which would be let out on contract in the US. 72 Current Soviet
literature indicates that the planners are not unaware of the advantages
accruing from the highly specialized industrial pattern of the US. 73
The value of this specialization first became apparent during World
War II, when the Soviet machine-building industry, in which specializa-
tion was furthest advanced, demonstrated its ability to produce war
equipment mach more efficiently than some of the other industries. 74
Since that time the building of machines has been based more and more
on this system of product specialization and planned cooperation
between assembly enterprises and their subcontractors. 75 Stalin,
in a speech made on the occasion of the twenty-eighth anniversary
of the October Revolution (7 November 1945)., stated that "our military
plants and their subcontracting enterprises are faultlessly supplying
the Red Army with equipment, mine sweepers, antiaircraft guns, tanks,
machine guns, rifles, and a=ition." 76 A Soviet engineer in
referring to this statement in 1950 pointed out that "the fact that.
Stalin singled out the military subcontracting plants for special
mention points not only to their great and responsible role in the
country's economy but also to the extent of their cooperation." 77
This increased emphasis on specialization is tempered, however,
by Soviet insistence on regional self-sufficiency wherever possible. 78/
This is prompted primarily by the problem of transportation, which
would be aggravates in case of war. Soviet literature stresses the
fact that individual subcontracting plants should be tied together by
plan with individual assembly plants in the interests of continuous
supply, transport economy, and regional self-sufficiency. 79 As a
prime example of this cooperation between producers and their suppliers,
it is stated that during the war "Urals combat vehicles were equipped
with machine guns, motors, bearings, electric wiring, radio equipment,
and rubber and plastic parts produced in the Urals." 80
This system of final assembly plants and their component
suppliers is dispersed throughout the USSR, with the exception of the
Far East. The industry is organized into four general areas, which
may be termed the Northern, Southern, Ural, and West Siberian areas.
It should be pointed out that the following is a physical description
of the industry based on geographical location. The administrative
subordination of the various subcontractors is based on the industrial
nature of their specialty, not on the fact that they produce tank
S -E-C -R -E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-CI-R-E-T
-- fl---
parts, 81 Thus the armaments and ptics plants are subordinate to
the Ministry of Defense Industry; the electrical equipment plants to
the Ministry of Electrical Industr ; the ball. bearing plants to the
Ministry of Automobile, Tractor, a Agricultural Machine Building;
the rubber parts suppliers to the Ministry of Chemical Industry; the
steel suppliers to the Ministry of errous Metallurgy; and so forth. 82
As previously indicated, the Main Aldministration for Tank Construc-
tion administers little besides the six tank assembly plants them-
selves.
1. Northern Region.
The Northern Region is
Machine Building Plant No. 185 ime
divided into four main production
division engaged in the production
producing turbines, and a division
full-tracked prime mover, the AFV
and assault guns. 84 The princip
ponent supplied by each are as fol.
Component Supplier**
Kolpino Metallurgical Plant imenJ88
Izhorskiy 87
Leningrad Plant imeni Kasitskiy
Leningrad Instrument Plant
Votranpribor 89
Leningrad Plant imeni Voroshilov 9C
Saratov Plant No. 44 91
Leningrad Artillery Plant No. 7
imeni Frunze 92
Kovrov Small Arms Plant No. 2 93
Yaroslavl' Rubber Kombinat 94/
Moscow State Bearing Plant** 95
* In addition to the component 11
supplied to all six of the AFV fin
Ferroalloy Plant imeni Voroshilov _
Plant imeni Beriya. 86/
centered on the Leningrad Heavy
Kirov, which is believed to be
ivisions. 83 In addition to a
of basic steel products, a division
suspected to be producing a small
ivision is producing heavy tanks
1 component suppliers and the com-
ows:
Component Supplied
Ferrous Metal
Electrical and Radio Equipment
Optics and Special Instruments
Engine
Transmission
Primary Armament
Secondary Armament
Rubber Parts
Antifriction Bearings
sted above, ferroalloys are provably
1 assembly plants by the Chelyabinsk
5/ and by the Zestafoni Ferroalloy
XX The association of this plant 4s an antifriction bearings supplier
has been inferred.
- 16 -
S -E -0 -R-E -T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S -E -C -R-E-T
2. Southern Region.
The Southern Region is centered on the Khar'kov Transport
Machine Building Plant No. 75 imeni Komintern, which is producing
diesel locomotives TE-1 and TE-2 in addition to the T-54 medium
tank. 96 Its principal component suppliers and the component
supplied by each are as follows:
Component Supplier
Component Supplied
Zhdanov Metallurgical Plant imeni
Il'ich 97
Ferrous Metals
Khar'kov Electric-Mechanical Plant 98
Electrical and Radio Equipment
Khar'kov Instrument Plant No. 13 99
Optics and Special Instruments
Saratov Plant No. 44 100
Transmission
Leningrad Artillery Plant No. 7 imeni
Frunze 101
Primary Armament
Kovrov Small Arms Plant No. 2 102
Secondary Armament
Khar'kov Rubber Goods Plant 103
Rubber Parts
Khar'kov State Bearing Plant No. 8 104
Antifriction Bearings
West Siberian Region.
The West Siberian Region is centered on the Omsk Machine
Building Plant No. 174 imeni Voroshilov, which has also engaged in the
production of coal cutters in the postwar period. 105 Its principal
component suppliers and the component supplied by each are as follows:
Component Supplier Component Supplied
Stalinsk Metallurgical Kombinat 106 Ferrous Metal
Omsk Plant No. 210 imeni Kasitskiy
107 Electrical and Radio Equipment
Tomsk Optical Plant 108 Optics and Special Instruments
Tomsk Manometer Plant No. 23 109
Murom Plant imeni KPF Transmission
Barnaul Diesel Engine Plant No. 77
1101/. Engine
- 17 -
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
-C -R-E -T
Component Supplier
Component Supplied
Molotov Artillery Plant No. 172
111
Primary Armament
Zlatoust Small Arms Plant No. 66
112
Secondary Armament
Izhevsk Small Arms Plant No.
74
113
Omsk Tire Plant* 114
Rubber Parts
Tomsk State Bearing Plant No.
5
115
Antifriction Bearings.
* The association of this plant as a rubber parts supplier has been
inferred.
4. Urals Region.
By far the most important region of the four in terms of
both current output and potential capacity is the Urals region, which
contains three assembly plants. These are the Ural Tank Plant No. 183,
which is part of the Nizhniy Tagil Railroad Car Building Plant; the
Chelyabinsk Tank Plant No. 100, which is part of the Chelyabinsk
Tractor Plant; and the Sverdlovsk Tank Plant No. 50, which is part of
the Sverdlovsk "Uralmash" Heavy Machine Building Plant imeni
Ordzhonikidze. 116 Their suppliers, many of which supply all three
plants, and the component supplied by each, are as follows:
Component Supplier
Component Supplied
Novo Tagil Metallurgical Kombinat 117
Ferrous Metal
Sverdlovsk Plant No. 210 118
Electrical and Radio Equipment
Che:Lyabinsk Plant No. 255 119
Novosibirsk Optical Mechanical Plant
No. 69 120
j
Optics and Special Instruments
Murom Plant imeni KPF 121/
Transmission
Che:Lyabinsk Plant imeni Stalin 122/
Engine
Sverdlovsk Plant No. 8 123
Molotov Artillery Plant No. 172 124
Sverdlovsk Artillery Plant No. 9 125
Primary Armament
Yurga Artillery Plant No. 75 126
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S -E-C-R- -Ir-
Component Supplier Component Supplied
Zlatoust Small Arms Plant No. 66 12 Secondary Armament
Izhevsk Small Arms Plant No. 74 12
Sverdlovsk Rubber Parts Plant
No. 721 12 Rubber Parts
Sverdlovsk State Bearing Plant
No. 6 130/ Antifriction Bearings
The importance of Sverdlovsk to the tank and assault gun
industry is to be emphasized. The Urals region produces about 50 per-
cent of the total AFV's manufactured in the USSR today, and Sverdlovsk
plays an important role in that production. 131 This city in addi-
tion to housing Plant No. 50, which is the home of assault guns in
the USSR, is a major rail junction through which are routed supplies
and finished components to the other two Urals assembly plants. 132
Furthermore, the city supplies rubber products, antifriction bearings,
electrical parts, and other equipment for all three Urals plants. 133
The destruction or neutralization of Sverdlovsk would force a serious
curtailment of AFV production in the USSR.
5. Far Eastern Region.
At the present time there is no Soviet AFV assembly plant
farther east than the Omsk Machine Building Plant No. 174 imeni
Voroshilov. 134 In view of the pattern of regional self-sufficiency
which prevails in the Soviet AFV industry and the probability that
the USSR will continue to supply tanks and other armored vehicles to
China for some time to come, a question arises concerning the possible
intention on the part of the USSR to establish an AFV assembly plant
in the Far Eastern region.
At the present time, AFV are transported to the Soviet Far
East over the Trans-Siberian Railroad. Interdiction of this railroad
in time of war would of course curtail the flow of tanks, which, in
the event of large-scale military action, would be considerable. It
would therefore seem logical to assume that this problem has received
consideration by the Main Administration for Tank and Mechanized
- 19 -
S -E-C -R-E -T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S .E- -R-E-T
I
Forces and by higher authority. Fence the establishment of a Far East
AFV assembly plant stands out as a, .distinct possibility.
C. Transportation Requirement`s.
As has been indicated abovb, the supply of component parts to
AFV assembly plants is based on thie specialization of machine-
building plants in the production Of individual AFV components and, to
the extent possible, on the location of these specialist plants in the
same industrial region as the assembly plant. When feasible -- and it
often. is feasible -- these component plants are located in the same
city as is the assembly plant. Thee industry shows at present a marked
degree of compartmentalization in 3that, with few exceptions, the com-
ponent plants are located very near the assembly plant in terms of
railroad distance. The average distance of all component suppliers
from the assembly plant served is x.,060 kilometers, or about 660
miles.- In all cases, ferrous metal, the primary component in terms
of weight, is furnished to the assfembly plants from mills located very
near the assembly plant. The total.. rail-traffic requirement placed on
Soviet railroads in 1953 by the to ik and assault gun industry for the
delivery of direct inputs is 123 million metric tons.** This magnitude
represents only about 0.15 percent of the total estimated operating
metric-ton kilometers of all freight transported in 1953 by Soviet
railroads.
The tendency in the USSR is toward further increase in the
number of machine-building plants ,and further increase in the number
of plants specializing in the proction of machines, parts, assemblies,
and the like. 136 These two dev opments and the strategic value
considerations inherent in them indicate that in the future the in-
dustry pattern of plant location and the resulting scheme of supply
As calculated from distances shown in 135/-
This total is the summation of the metric-ton kilometers required
for each of the six assembly plants. The total for each is the product
of the multiplication of three factors: (1) the individual weight of
a given component as known or estimated, (2) the number of units of
this component needed to supply current estimated production, and
(3) the railroad distance between; the component plant and the
assembly plant. Only those compohents which move by rail are included.
The total metric tons transported by rail were estimated at 314,000.
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
will show an even more marked degree of regional self-sufficiency
within the AFV producing regions, discussed previously. This further
compartmentalization will result, also, in a better utilization of
transport facilities in those regions of the USSR where railroad-
freight-traffic capacity has been a stumbling block in the path of
Soviet planners.
The Soviet tank and assault gun industry is subject to the
same vulnerabilities as are other Soviet machine-building industries,
such as loss of electric power and shortages of skilled labor and of
material. The present study reveals no vulnerability of an economic
nature which is peculiar to the tank and assault gun industry.
Indeed, there is evidence that it enjoys preferential treatment in
the allocation of productive resources, which tends to reduce the
probability of occurrence of the normal production stoppages. It is
to be pointed out, however, that the loss or denial of the output of
Sverdlovsk industrial plants would constitute a serious curtailment
of Soviet AFV production. This city supplies the assembly plants of
the Urals region with electrical equipment, primary AFV armament, ball
bearings, and rubber parts; and the three Urals assembly plants pro-
duce about 50 percent of the total AFV produced in the USSR.
A possible vulnerability indicated by the present subject
matter is the lack of AFV assembly plants and component parts plants
in the Far Eastern regions of the USSR. Should transport facilities
between West Siberia and the maritime provinces be denied the USSR in
time of war, the combat effectiveness of mechanized forces in the Far
East would be materially lessened through the lack of the capability
to resupply these units with AFV lost in combat.
The intentions of the Soviet government with respect to this
industry appear to be unchanged -- continuing advances in the design
of all AFV models, periodic replacement of its AFV park with modern
equipment, and the maintenance of adequate production potential to
support any possible course of action which the Soviet Army might
take.
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
3-E-C-R-E-T
Since the war there hab been an increase in the number of
component parts suppliers in the industry, and this trend apparently
will continue. The effect is Twofold: (1) a more narrowly com-
partmental regional self-suffi4iency in the various AFV's producing
regions and (2) the further specialization of individual plants in
t:he production of specific AFVcomponents, the specialized plants
being associated with specific assembly plants on a continuous con-
tractual basis.
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S- E- C-R- E- T
APPENDIX A
METHODOLOGY
Basically the purposes of this report are twofold: (1) to pre-
sent a detailed description of the planning, procurement, and supply
techniques which are operative in Soviet armament industries with
particular reference to the AFV industry and (2) to present a
comprehensive outline of the component-parts-supply structure of the
industry and its regional distribution. The methodology employed
for the first of these purposes was to study available material
dealing with the historical development and the current Soviet phil-
osophy of industrial planning, procurement, and supply, and to dis-
cover thereby the principles upon which this system operates and
what are its specific practical effects.
For the second of these purposes the methodology involved the study
of a great number of Soviet industrial plants, information about which
is consolidated in the CIA/CD Industrial Register, and the tempering
of the intelligence thus gleaned by the relatively few higher level
reports which deal with the philosophy of procurement and supply re-
ceived periodically from Soviet defectors, prisoners of war, and former
Soviet citizens presently residing outside the Soviet Bloc.
In Section III of the report it was occasionally necessary to infer
from general statements and geography that a particular component-part
plant was associated with a specific AFV assembly plant, although the
same plant's association with the AFV industry generally was readily
apparent. The transport requirements of the AFV industry were
calculated from known weights of some models of Soviet AFV's and their
components and known railroad distances on Soviet lines. For the
new AFV models, weights were estimated from those models for which
weights are known.
S-E-C-R-E-T
Approved For Release 1999/09/08 CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
APPENDIX B
GAPS IN INTELLIGENCE
There is in general a decided lack of information since 1949
dealing with AFV's. With specific reference to this report a partic-
ularly important gap in intelligence is the lack of detailed informa-
tion on Soviet policy in the matter of replacement of older AFV models
with the new, the rates of attrition for AFV models resulting from
mechanical deterioration, the policy regarding the maintenance of an
AFV reserve. both in reserve units of the armed forces and in regular
Soviet Army units, and the magnitude of this reserve stockpile. All
these factors, when combined with technical obsolescence, are
determining factors in establishing current production rates.
S -E-C -R -E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S -E -C -R-E-T
APPENDIX C
SOURCES AND EVALUATION OF SOURCES
1. Evaluation of Sources.
The sources used in the preparation of this report can be placed
in two broad categories. These are (a) the sources of information on
the operations of the Soviet economy with its planning, procurement,
and supply aspects and (b) the sources furnishing information on the
industrial association of specific Soviet enterprises for the manu-
facture of tanks and assault guns.
The material utilized from sources falling into the first category
consists primarily of direct information from Soviet periodicals and
monographs or similar information as quoted by Western authors. It
is considered that this information is of the highest reliability. By
and large, the Soviet authors are either setting forth principles and
procedures to be followed by their compatriots or criticizing various
aspects thereof. While it is necessary to fit the context of Soviet
statements within the framework and philosophy of Soviet economic
operations, it is believed that these sources are in the main accurate
and reliable.
The sources falling into the second category consist primarily of
repatriated prisoners of war and defectors. These, when taken in-
dividually, represent rather low-grade sources. When sources of this
nature are taken collectively, however, and in relation to their
probable knowledge, their reliability increases many times. Informa-
tion on the operation of a Soviet industrial firm and its relation-
ship with its customers and suppliers is not the kind of information
which the above sources would be in a position to obtain normally.
However, sufficient information is available to tie the subcontractors
to the producing plant either on the basis of direct intelligence or
inference from their relative geographical location and the known
activity of each plant. In most cases, however, it was not possible
to determine the flow of a specific component to a manufacturing
plant with sufficient accuracy to establish a firm confirmation of
production estimates made by other means.
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
CIA field requirements have
this subject, and the possibili
tion could be obtained from ava
S4E-C-R-E-T
not laid particular emphasis on
y exists that considerable informa-
lable sources, using this approach.
The basic information dealing specifically with the. AFV in-
dustry, chiefly in Section III df this report, has been obtained
almost entirely from the CIA In ustial Register. Because many of
the documents in the Industrial Register do not bear sufficiently
detailed information to be cite4 individually, or they cannot be
found elsewhere, the only conve4ient reference has been the use of
the IR number.
Evaluations, following thec1assification entry and designated
"Eval.," have the following si ificance:
Source of Information
Doc. - Documentary
A - Completely reliable
B - Usually reliable
C - Fairly reliable
D - Not usually reliable
E - Not reliable
F - Cannot be judged
11 - Confirmed by other sources
Probably true
31 - Possibly true
- Doubtful
51 - Probably false
61- Cannot be judged
I
"Documentary" refers to orig nal documents of foreign governments
and organizations; copies or tr slations of such documents by a staff
officer; or information extracte from such documents by a staff
officer, all of which will carrylthe field evaluation "Documentary"
instead of a numerical grade. I
Evaluations not otherwise designated are those appearing on the
cited document; those designated "RR" are by the author of this re-
port. No "RR" evaluation is givn when the author agrees with the
evaluations on the cited document.
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
25X1A2g 1.
2.
25X1A
25X1X7
3. Ibid.
4. Ibid.
5. Ibid.
25X1 A2g 6.
7. CIA RR PR-25, The Tank and Assault Gun Industry of the USSR,
27 Feb 1953. S.
8. D. Granik, Management of the Industrial Firm in the USSR,
1954, p. 64. U. Eval. RR 2.
9. Ibid.
Bienstock, Swartz, and Yugow, Management in Russian Industry
and Agriculture, New York, 1946, pp. 7-55. U. Eval. RR 2.
A. Arakelian, Industrial Management in the USSR, Moscow, 1949
(translated), p. 97. U. Eval. RR 2.
Fortune, "How Business is Done in Russia," Feb 1953, p. 122.
U. Eval. RR 2.
10. Ibid.
11. CIA RR PR-25, OP. cit.
12. I.A. Luganin, Administration and Planning of Industry in the
USSR, Post 19 , as cited by Granik, op. cit. U. Eval. RR 2.
Granik, op. cit., pp. 64-67.
13. Granik, op. cit., pp. 64-67.
14. Ibid.
15. Bienstock, Swartz, and Yugow, op. cit., pp. 47-55. U. Eval.
RR 2.
Arakelian, op. cit., p. 102.
16. Granik, op. cit., pp. 64-67.
17. Ibid.
18. Ibid.
19. Ibid.
20. Ibid.
21. Ibid.
22. V. Kontorovich, Tekpromfinplan promyshlennogo predpriyatiya,
Moscow, 1948, pp. 19-22, as cited by Granik, oE. cit. U.
Eval. RR 2.
P.A. Shein, Material'no tekhnicheskoye snabzheniye mashinostroitel'
nykh zavodov, Moscow-Leningrad, 1947, p. 102, as cited by
Granik, op. cit. U. Eval. RR 2.
M. Demchenko,7 Intra-Factory Planning and the Technical-Produc-
tion-Financial Plan of an Enterprise"7, Sovetskiye Profsoyuzy,
Aug 1952. U. Eval. RR 2.
-29-
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-RE-T
23. :Ibid.
24. Kontorovich, op. cit., p. 22.',
A.I. But, Planirovaniye v tsvltnoy metallurgii,Moscow, 1946,
pp. 8-9, as cited by Granik,oo . cit. U. Eval. RR 2.
25. S. Ye. Kamenitser, Or anizats a i planirovaniye sotsialisti-
cheskogo promyshlennogo pred riyatiya, Gosplanizdat, Moscow,
1950, pp. 2b2-2d5. U. Eval RR 2.
26. Ibid., pp. 17-21.
25X1A2g
27. :Ibid.
28. Ibid.
29. Kamenitser, OP.. cit., pp. 17-21.
30. B. Ya. Ryabin'skiy, Planirovaniye proizvodstva na metal-
lurgicheskom zavode, Moscow,1950, pp. 56-57. U. Eval.
RR 2.
31. :Ibid.
32. G.I. Bronskiy, Khozraschet i rentabel'nost promyshlennogo
predpriyatiya, Gozfinizdat, Moscow, 1950, pp. 6b-69- U.
Eval. RR 2.
33. But, op. cit.
34. Avtomobil'naya i traktornaya promyshlennost', No. 7, 1952, "Usilit'
rabotu po ekonomicheskomu ispol'sovaniyu metalla," U. Eval. RR 2.
35. B. Sukharevskiy, "Material'nye balansy promyshlennoy
produktsii v narodnokhozyaystvennom plane," Planovoye
Khozyaystvo, 1937, No. 11-12, pp. 27-40. U. Eval. RR 2.
E. Lokshin, Planirovaniye material'no-tekhnicheskogo snabzheniya
narodnogo khozyaystva, Moscow, 1952. U. Eval. RR 2.
36. E. LDkshin, "Voprosy planirovaniya material'no-tekhnicheskogo
snabzheniya narodnogo khozyaystva SSSR" Narodnoye Khozyaystvo
SSSR, Moscow, 1951, p. 220. U. Eval. RR 2.
37. Sukharevskiy, op. cit., p. 28.
38. Granik, op. cit., p. 135.
39. Lokshin, Planirovaniye material'no-tekhnicheskogo snabzheniya
narodno,o khozyaystva, op. cit., p. 76.
40. Lokshin, "Voprosy planirovaniya material'no-tekhnicheskogo
snabzheniya narodnogo khozysystva SSSR," op. cit., pp. 219-220.
41. Ibid.
42. A.A. Iotkovskiy, Material'noye snabzheniye i sbyt produktsiy
promyshlennogo predpriyatiyad Gospolitizdat, Leningrad, 19 14 ,
PP. 15-30. U. Eval. RR 2.
43. Granik, op. cit., p. 136.
44. Ibid.
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
S-E-C-R-E-T
45. Ibid.
46. Iotkovskiy, op. cit., pp. 15-30.
47. Beinstock, Swartz, and Yugow, op. cit., pp. 66-82.
Arakelian, op. cit., pp. 97-987-
48. Iotkovskiy, op. Cit., pp. 15-30.
49. Ibid.
50- Ibid.
51. Beinstock, Swartz, and Yugow, OP. cit., pp. 58-65.
52. Ibid.
53. F.N. Kaschenko, "Meropriyatiya po uporyadocheniyu raboty
otraslevykh snabov i sbytov," Snab i Sklad, No. 6, dated
1936, p. 21, as cited by Granik, op. cit. U. Eval. RR 2.
54. Granik, op. cit., pp. 203-206. Eval. RR 2.
Beinstock, Swartz, and Yugow, OP. cit., pp. 58-62. Eval.
RR 2.
Arakelian, op. cit., pp. 97-98. Eval. Doc.
Shein, op. cit., pp. 17 and 21-22. Eval. Doc.
Demchenko, o .cit., pp. 19-21. Eval. Doc.
55. Granik, op. cit., p. 148.
56. Fortune, op. cit., p. 122..
Pravda, 27Sep 1940, p. 3. U. Eval. RR 2.
57. Shein, op. cit., pp. 75-77.
58. Ibid.
59. Ibid.
6o. Ibid.
61. Narodnoye Khozyaystvo, Vol. 3, 1950, pp. 254-264. U.
Eval. RR 2.
62. Ibid.
25X1A2g
63. Sobraniye postanovleniy i rasporyazheniy soveta ministrov
SSSR, No. 9, g2. cit.
64. Sovetskoye Gosudarstvo i Pravo, No. 8, dated 1943, pp. 86-
95. U. Eval. Doc.
kumenitser, op. cit., pp. 17-21.
Beinstock, Swartz, and Yugow, op. cit., pp. 58-65.
65. Ibid.
66. CIA RR PR-25, OP. cit., p. 39.
25X1 A29 67.
N.A. Voznesenskiy, The Economy of the USSR During World
War II, p. 830. U. Eval. RR 2.
25X1A
S-E-C-R-E-T
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 25X1A
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
Next 3 Page(s) In Document Exempt
Approved For Release 1999/09/08 : CIA-RDP79-01093A000700110005-5
 Approved For Release 1999/09/0 - "-3AO00700110005-5
US OFFICIALS ONLY
US OFFICIALS ONLY
-f~CT
Approved For Release 1999/09/M$,:,~C fthyrAU93AO00700110005-5
(1~IVV