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May 6, 2008

RUSSIA: Govt considers Avtotor customs changes

The Russian government wants carmaker Avtotor to have customs benefits for the annual assembly of no more than 10,000 vehicles in Russia's Kaliningrad Region, an Industry and Energy Ministry official has reportedly said.

The Russian government wants carmaker Avtotor to have customs benefits for the annual assembly of no more than 10,000 vehicles in Russia’s Kaliningrad Region, an Industry and Energy Ministry official has reportedly said.

The official was reportedly commenting on a draft ruling recently submitted to the government.

Prime-Tass said the draft ruling was developed by the Economic Development and Trade Ministry and submitted to the government.

The draft ruling does not envisage restricting the number of cars assembled in the Kaliningrad Region or the number of cars brought into the rest of Russia, Viktor Semyonov, head of the Industry and Energy Ministry’s industry department, said.

The ruling is aimed at creating equal conditions for car assembly across Russia, Semyonov said. The government wants to reduce the company’s profit by regulating its customs benefits, he added.

Last month, workers at Avtotor, which produces cars in the Kaliningrad Region, took part in a rally to protest against the provisions of the draft ruling, which were interpreted as the limitation of vehicle output to 10,000 units per year.

Avtotor assembled 106,368 vehicles in 2007. The company assembles BMW, Cadillac, Hummer, Chevrolet, KIA and other vehicles, Prime-Tass said.

Meanwhile, Russia’s largest carmaker AvtoVAZ has asked the government to consider lifting tariffs on some car component imports.

In particular, AvtoVAZ wants the government wants the government to abolish tariffs on imports of some car coating, tyres and metal components.

AvtoVAZ , in which Renault is acquiring a 25 percent stake, saw sales grow 30% year-on-year in April 2008 to 67,000 cars, the company said in a statement on Monday.

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