Purchasing director General Motors Russia, Peter Layer, recently spoke at the Russian Automotive Forum in Moscow, organised by Adam Smith Conferences, as well as talking to Simon Warburton on the sidelines of the event.
j-a: Have you noticed major changes in the Russian market during your time here?
Go deeper with GlobalData
PL: I have been here three years and it has definitely evolved and it needs to evolve. We need to invest time in the supplier base to bring them up to what I would say are global standards.
Steel has come a long way. Some commodities do not even exist. The electronic industry – that is not something we would buy in Russia.
j-a: How heavily does localisation feature in Russia?
PL: Localisation is important for government and it is just good business sense. Long-range logistics – shipping in parts from overseas does not make business sense.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataWe would like to see a healthy mix of multi-national [s] and local supplier [s]. It is a combination of them coming as stand alone and making relationships with local Russian suppliers.
We work with a lot of suppliers who are purely Russian. We expect multi-nationals to transfer their knowledge. A lot of times, we would rather be local.
j-a: How you would characterise moving parts around Russia?
PL: Russia is still in its infancy [with] infrastructure. Roads and rail are too cumbersome, but the ports are not bad.
A lot of Russians aspire to own a car. We definitely see the road infrastructure still needs more investment and the government is putting more money into it.
j-a: Is the Russian government providing the right environment for OEMs in the country, both at a national and regional level?
PL: We work with the different [regional] governments. The Russian government is very supportive in all areas
Russia is a very dynamic market – it is not slow by any means – [we saw] the market go from being at a stand-still to today.
Layer also spoke at the Russian Automotive Forum, where he outlined some points concerning the domestic supply base and highlighted the success of GM’s recent partnership with GAZ Group to produce the Chevrolet Aveo in the Nizhny Novgorod plant.
“The key roadblock is an immature supply base,” he said. “It is not against you and your companies, but it is a point about where you are in your evolution.
“Proper project management [is important] and operating with a sense of urgency. But you can’t expect the suppliers to do all this on their own.
It is a joint task. Each party should and must, do its part of the job. If they do, we can all benefit from this.
Russia is one of our top four markets. Even ten years ago, Russia was not in the top ten globally, but it is amazing how fast the world changes.
We are especially proud of our Chevrolet sales [while] for Opel, Russia is the fourth largest market.
We have forged a new relationship with GAZ [Group] and this February, launched a new Aveo. GM and GAZ invested just short of US$30m to prepare the brownfield site – it is a brand new facility.
The range of Chevrolet models in Russia includes the city car Spark , sub-compact Aveo sedan and hatchback, the four-door Cruze in sedan, hatchback and wagon, a mid-size sedan Malibu, the minivan Orlando, SUV Captiva, a full-size SUV Tahoe and the Camaro sports car.
In 2013, new products in Russia will be a low-cost sedan Cobalt and the mid-size SUV Trailblazer, while for next year the market will see a compact SUV Tracker , pick-up Colorado and the seventh generation of the Corvette Stingray.
Chevrolet is represented in 154 retail outlets and service centres across Russia.
