Mercedes-Benz is to create a new plant to make cars in the Moscow Region of Russia from 2019. The move confirms rumours in recent years that the company was planning such a step.
The company plans to make cars at a plant on the Esipovo Industrial Park, about 40 kilometres northwest of Moscow. It said the ‘flexible’ plant will make SUVs and the E-Class model.
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Daimler will invest more than EUR250m in the new production facility, where the first cars will leave the assembly line in 2019.
“Russia is of strategic importance for Mercedes-Benz and an attractive growth market. That is why we expand our worldwide production network with a new plant at Esipovo Industrial Park,” said Markus Schäfer, Member of the Divisional Board of Mercedes-Benz Cars, Production and Supply Chain Management. “By establishing a local production we do not only achieve greater proximity to our Russian costumers but also strengthen the international competitiveness of Mercedes-Benz Cars.”
Although the Russian car market has collapsed as the Russian economy suffered recession, there are hopes that it has stabilised. While some manufacturers have left the market, others are staying and looking to long-term growth potential in a market with low levels of car ownership.
Mercedes-Benz says it was the top-selling premium brand among automobile manufacturers in Russia in 2016 for the fourth year in a row and adds that Russia remains one of the strong markets for Mercedes-Benz in Europe. Last year’s bestsellers were the E-Class sedan and the SUVs.
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By GlobalDataMercedes said the ‘new passenger car plant in the Moscow region will comprise all production steps, from the body show through paint shop to assembly’ creating some 1,000 jobs. The plant is part of the industrial park of Episovo, which is some 20 kms from an aftersales hub that the company created in 2016.
“The investment of Mercedes-Benz in the local production of passenger cars indicates the strategic decision of a global manufacturer and his trust in the Russian market, regardless of the short-term market environment,” said Alexander Morozov, Deputy Minister of Industry and Trade of the Russian Federation. “This shows the high attractiveness of the Russian automotive industry for investors.”
Andrey Vorobjov, Governor of the Moscow Region added: “The regional authorities believe that the local production of Mercedes-Benz passenger cars in the Moscow Region is an important component in order to create a favorable investment climate, and we will provide all necessary support to the project. The Moscow Region offers attractive business conditions. The establishment of the premium manufacturer’s plant will create more than 1,000 jobs and will help to attract more foreign companies in the region.”
Production at the new site is operated by the newly founded company Mercedes-Benz Manufacturing RUS (MBMR). In addition to Daimler AG, the joint venture Daimler Kamaz RUS (DK RUS) is also involved in MBMR. In the DK RUS joint venture, Daimler has been successfully cooperating with KAMAZ since 2010 to develop the Russian commercial vehicle market. Daimler and KAMAZ each hold a 50 percent stake in DK RUS.
“We have many years of experience in the production and localisation of vehicles in Russia,” said Sergei Kogogin, General Manager of KAMAZ. “This is why we are planning to continue working with Daimler AG in order to strategically expand our business and thus to further develop international suppliers in Russia.”
