Saturday, June 15, 2024

AvtoVAZ bought a plant for 1 Euro


On Tuesday, February 7, 2023, the head of AvtoVAZ, Maxim Sokolov, signed documents to acquire the former Nissan Manufacturing RUS plant in St. Petersburg. As part of the deal, 99 percent of the enterprise is transferred to AvtoVAZ at a price of 1 euro with payment in ruble equivalent at the exchange rate on the date of payment - today it is 75 rubles 99 kopecks. Nissan has a six-year buyback option if the Japanese side wants to take back the site and this step is approved by the Russian government.

Now AvtoVAZ is faced with the task of restarting production at the St. Petersburg plant and ensuring a high level of localization. It is already known that the plant will organize the production of cars of so far unnamed Chinese partners under the Lada brand. These will be models of classes C and D, which will not compete with current models of the Russian brand. Among them will be sedans and crossovers.

AvtoVAZ, for its part, confirmed plans to restart the plant in the second half of 2023. This year, 10,000 cars will roll off the assembly line.

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“In 2024-2027, we will localize these vehicles, where the key task will be to maximize the use of the capabilities of more than 30 regional suppliers of automotive components,” Maxim Sokolov said. - At the same time, for the successful development of the component industry, AvtoVAZ relies on government mechanisms to stimulate suppliers, for example, preferential loans from the federal and regional Industrial Development Funds. It is extremely important that these mechanisms are provided with adequate funding.”

According to the head of AvtoVAZ, by 2027, production volumes at the former site of Nissan Manufacturing RUS will reach 50-70 thousand units per year. The number of models that will roll off the assembly line "depends on the number of future partners." Which Chinese companies will help AvtoVAZ to restart the enterprise is still unknown.

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