Capitalist Russia Suffers Major Loss as Fire Destroys Factory : Economy: Vital truck engine plant is gutted. Western banks offer aid in rebuilding that could cost $1 billion.

In a devastating economic blow to capitalist Russia, a fearsome fire gutted the largest engine factory in the former Soviet Union, causing hundreds of millions of dollars in damage and hobbling the nation’s truck industry.

Officials said Wednesday that the blaze raged uncontrolled for 16 hours and then smoldered for a week, charring about 17 acres of the giant KamAZ truck factory in Tatarstan, about 570 miles east of Moscow. Estimates of the cost of rebuilding the plant range from $180 million to $1 billion.

The disaster was handled in the old Soviet style: For almost two weeks after the April 14 blaze, journalists were kept away from the plant, and the enterprise’s new shareholders received almost no news of the conflagration. On Wednesday, nearly a month after fire broke out in a transformer, the plant’s managers met with shareholders and journalists to lay out their reconstruction plans.

The Russian government has promised more than $85 million in direct aid and loans to help rebuild the plant, and Western banks have offered to lend $300 million, Nikolai I. Bekh, KamAZ’s general director, announced.

Seeking to play down the damage, KamAZ officials said the assembly line would continue to turn out trucks using engines imported or purchased from other Russian suppliers or would sell trucks without engines, for which there is a demand. And they estimated that the plant could be rebuilt within two years.

But economist Lev N. Karpov termed the fire “a major disaster” at a time when the Russian economy can hardly afford more mayhem.

The factory, completed in 1975, was considered the Soviet Union’s best heavy engine plant. Last year it produced 180,000 engines used in everything from cement trucks to military vehicles, KamAZ officials said. The city of Naberezhnye Chelny was created for the 120,000 workers at the KamAZ plant, and about 17,000 people worked in the part of the engine factory that burned. Though plant officials have promised there will be no layoffs, several KamAZ workers Wednesday said they feared for their jobs.