GAZ Group says it is looking to harness the domestic supply base in Russia as it aims to harness government automotive support.

Speaking to just-auto at the Automotive News Europe Congress in Cologne, GAZ Group CEO Bo Andersson highlighted the importance of the supply chain given cost priorities.

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“The greatest thing to manage is the equipment and supply base – [the] Russian supply base is capable.” he said. “The European supply base is too expensive for us.”

Anderson added he has also outlined some of his automotive industry thinking to the Russian government and has talked to Prime Minister Vladimir Putin.

“As I have said to the government many times, to drive co-operation, we should put some targets in place regarding fuel economy and emissions, but so far they have been reluctant,” he said.

Andersson equally provided some bullish forecasts for the Russian market in general, although he previously cautioned more discipline concerning raw materials was needed.

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The GAZ Group CEO noted Russia was “way behind” on raw material quality and that more checks were needed.

Nonetheless Andersson added: “I am definitely optimistic about the Russian market – it is a huge country [and] fuel continues to be relatively cheap.

“It is very clear Russia will be the largest [European] car market within two years – the market is up 60% this year.”

Earlier this year Russia introduced strict rules surrounding foreign automotive investment, including a threshold of 300,000 units in four years and the localisation of engines, gearboxes and stampings to achieve a 60% local content figure.

Russia introduced the requirements through an automotive decree issued in March led by Putin’s wish to drive increased manufacturing in the country.

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