Russian car production bounces back

Russian car production bounces back
Russia’s automotive sector was the hardest hit of all industries at the start of the war but now it is recovering thanks to thinly disguised counterfeits and China's help. / bne IntelliNews
By Ben Aris in Berlin June 24, 2024

Russia’s automotive sector was the hardest hit of all industries by the start of the war. From producing around a million cars a year, output fell to a low of a total of only 3,000 cars in July of the first year of war, as the sector came to a screeching halt.

While most of the leading European Original Equipment Manufacturers (OEMs) had set up factories in Russia, they were careful to continue to import up to 60% of parts from their factories in Europe, making the sector particularly vulnerable to self-imposed sanctions that halted production in Russia.

As bne IntelliNews reported, the sector has since recovered most of the ground lost and is on course to get back to the million cars a year pre-war production level, but the nature of the sector has changed dramatically.

First of all, China has stepped in to become the major supplier of exported cars to Russia and is now the biggest exporter in the world. Also in the last two years most of the Western car production factories have been taken over by Russian entrepreneurs or joint ventures to restart production – and in many cases the factories continue to make the same brands as they did before, ignoring the intellectual property ownership of the brands by the leading global car companies.

In 2021, automakers from Europe, the USA, Japan and South Korea accounted for 70% of cars sold in Russia, and taking into account the Russian national champion, and the maker of the iconic Lada, AvtoVAZ, 92% of which belonged to Renault-Nissan joint venture.

Immediately after the invasion of Ukraine, all Russian factories of these concerns stopped. The Russian car market has fallen almost threefold – from 1.54mn to 620,000.

In 2023, the economy recovered, Russians’ incomes began to grow, and the car market recovered half of the decline. Chinese models have been Russified and its factories are producing the Moskvich and the Volga, both modernised versions of Soviet-era brands, but most of the parts and technology are of chinese origin. Prices have also jumped by one and a half, or even two times.

In a report, The Bell listed the car factories, models and the changes:

 

AvtoVaz based in Tolyatti:

Owner: previously a joint venture with Renault-Nissan, now the Russian state

Pre-war models: Lada Vesta, Lada Granta, Lada Largus, Niva, Renault Logan/Sandero

Post-war models: Vesta, Granta and Niva

PSMA Rus in Kaluga:

Owner: previously Citroen, now the little known Automobile Technologies LLC

Pre-war models: Citroen C4, Peugeot 408, Peugeot Partner, Citroen Berlingo, Opel Combo, Mitsubishi Outlander, Pajero Sport

Post-war models: Citroen C5 Aircross made from Chinese components.

Avtoframos in Moscow:

Owner: previously Renault, now FSUE “NAMI” and the Moscow government.

Pre-war models: Renault Duster, Renault Captur.

Post-war models: Moskvich 3 (JAC JS4), Moskvich 6 (JAC A5 Plus)

Haval in Tula

Owner: China’s Jolion and ownership did not change, it remains the only full-cycle factory of a foreign company remaining in Russia.

Pre-war models: Haval Jolion, F7

Post-war models: Haval Jolion, F7, Dargo, H9

Mercedes in the Moscow region

Owner: before Mercedes, now the Avilon car dealer (Alexander Varshavsky and Kamo Avagumyan).

Pre-war models: Mercedes E-class, Mercedes crossovers

Post-war models: production is being established to assembling cars under its own brand probably in partnership with Chinese Li Auto.

Volkswagen in Kaluga

Owner: before Volkswagen, now Avilon car dealer.

Pre-war models: VW Polo and other Volkswagen, Audi models

Post-war models: production has not resumed.

Hyundai in St. Petersburg

Owner: before Hyundai, now Avilon car dealer

Pre-war models: Hyundai Solaris, Hyundai Creta, Kia Rio

Post-war models: assembly of the same cars under new brands from the remaining car kits

Lada in Izhevsk

Owner: AvtoVaz, did not change owner

Pre-war models: Lada Vesta

Post-war models: Lada Vesta

Nissan in St. Petersburg

Owner: before Nissan, now FSUE "NAMI" and AvtoVAZ

Pre-war models: Nissan Qashqai, X-Trail and Murano

Post-war models: assembly of Chinese Chery cars including currently the Tiggo 7 Pro crossover under the Xcite brand.

Toyota in St. Petersburg

Owner: before Toyota, now FSUE "NAMI"

Pre-war models: Toyota RAV4, Camry

Post-war models: Aurus executive sedans form the end of 2024

GM in St. Petersburg

Owner: before GM, now the plant has been mothballed since 2015. St. Petersburg want to turn the site into an educational training ground for technical schools.

Pre-war models: Opel Astra and Chevrolet Blaze

Post-war models: none.

Avtotor in Kaliningrad

Owner: did not change owner

Pre-war models: contract assembly of cars of various brands, including Kia, Hyundai, BMW

Post-war models: assembly of cars of Chinese brands, including Kaiyi and BAIC.

GAZ in Nizhny Novgorod

Owner: plant did not change owner (Oleg Deripaska's Russian Machines).

Pre-war models: Volkswagen Jetta, Skoda Octavia and Yeti

Post-war models: revived Soviet Volga brand based on the Chinese Changan model.

Derways in  Cherkessk

Owner: Roads LLC of (Abrek Tebuev)

Pre-war models: assembly of Chinese models

Post-war models: none

UAZ in Ulyanovsk

Owner: Russia’s Sollers PJSC, plant did not change owner

Pre-war models: UAZ “Hunter”, UAZ “Patriot”, UAZ SGR (“Loaf”)

Post-war models: UAZ “Hunter”, UAZ “Patriot”, “Loaves” including simplified versions

Sollers in Vladivostok

Owner: Russia’s Sollers PJSC, plant did not change owner

Pre-war models: Mazda6 and CX-5

Post-war models: assembly of Chinese JAC pickups under the Sollers brand.

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