Russia's Largest Steel Manufacturer Selects Tecnomatix eMPower Solutions to Streamline Production Cycles

HERZLIA, Israel--Oct. 18, 2004-- Tecnomatix Technologies Ltd. (NASDAQ: TCNO), the driving force in Manufacturing Process Management (MPM), today announced that Severstal, Russia’s largest steel manufacturer, has selected Tecnomatix eMPower™ solutions to more efficiently visualize, simulate and forecast its facility operations, converter production and resource scheduling.

Severstal is using eM-Plant software, which models and simulates production systems and processes, to:

• Forecast converter production output and estimate the effect of plant modernization and maintenance efforts
• Perform day-to-day resource scheduling of converter production by means of a solution integrated into corporate planning systems
• Simulate the company’s various production facilities with the aim of identifying productivity reserves and automating production scheduling and other processes

"The flexibility and power of the eM-Plant product as a simulation tool was key in our decision to go ahead with the eMPower solution," said Sergei Anikin, head of converter production automation, Severstal. "We wanted to take our production process planning to a new level of efficiency and we knew that with Tecnomatix, we could achieve that. We have been pleased with the initial results of our implementations, and expect further cost savings and productivity enhancements as our eMPower integration and implementation efforts continue."

"This is a very significant win for Tecnomatix - helping to solidify our growing presence in the Russian manufacturing market by working with one of its leaders," said Jaron Lotan, president and chief executive officer of Tecnomatix. "Through our eMPower solutions, we’re able to offer manufacturers like Severstal the capabilities to make better, more informed business decisions earlier in the production process. We are pleased to be sharing our vision with Severstal and we hope that our relationship continues to grow."

About Severstal Joint-Stock Company (JSC Severstal)

Severstal is a completely integrated steel-making plant, producing numerous kinds of steel flat-rolled carbon steel products (hot-rolled, cold-rolled, electrogalvanized, and hot-dip galvanized), which are sold largely to automakers as well as to manufacturers of steel structures for industrial construction and welded pipes. 2003 revenues totaled US$3.2B worldwide. Russia is Severstal’s main market, representing about 59% of its total business, followed by Europe at 14%, and Asia and the Middle East, totalling 16%. For more information, see www.severstal.ru.