General Motors and AvtoVAZ will announce in November a plan to construct of a transmission and engine plant in Togliatti (Samara region), according to Vedomosti, the Novosti news agency reported.

The plant will be equipped with equipment from the bankrupt Daewoo Motors India, which closed in 2001. Investment in the project is estimated at $US400-500 million.

In May 2004, Vedomosti said, John Mylonas, GM-AvtoVAZ general director, announced the project to construct an engine plant in Togliatti. According to Mylonas, this will be “an unprecedented foreign investment in the Russian automobile industry.” Investors in the project include GM, AvtoVAZ, and a bank.

According to a GM-AvtoVAZ shareholder, the European Bank for Reconstruction and Development (EBRD) will be one of the project’s investors and will invest $240 million in the company.

“The plant [in Togliatti] will be re-equipped to manufacture Opel engines for the Chevrolet Viva, the export model of Chevrolet Niva, and promising GM-AvtoVAZ models,” said a representative of the AvtoVAZ technical development department. Transmissions will also be assembled at the plant.

GM-AvtoVAZ was incorporated by General Motors (41.5%), AvtoVAZ (41.5%) and the EBRD (17%) in the summer of 2001. In 2003, the plant assembled 25,235 Chevy Nivas. In 2004, it plans to produce 55,150 cars.