Lada will produce a military 4x4 branded Kalashnikov, according to the Russian news agency Novosti.

The company said that it would join forces with Russia's principal arms export company, Rosoboronexport, to design a 4x4 vehicle that would bear the weapon designer's name.
Integral to the idea is the fact that the export company, Rosoboronexport, has effectively controlled AvtoVAZ since December 2005.

Lada does not currently produce military vehicles.

The main customer would be the Russian Defence Ministry.

The new military vehicles should cost around €160m to develop, according to another source.

AvtoVAZ is reported to have sold 205,000 cars in the first four months of 2006, up 7.8% compared to a year earlier.