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RUSSIA: GAZ and China’s FAW ‘plan joint venture’

By Tony Lewis | 16 November 2011

Russia’s GAZ Group plans to start assembling heavy trucks for China’s First Automobile Works (FAW) in 2012, according to the Russian business daily Kommersant.

Annual production at GAZ’s Ural facility in Miass is expected to be around 10,000 units, according to the report which quoted GAZ Group president Bo Andersson. The plan means modernising one of the Miass production lines; the trucks will be sold under the FAW brand.

Although GAZ has not disclosed how much it is spending on the venture, analysts quoted by Kommersant suggested it would be in the region of US$50-60m.

GAZ will also start assembling three Volkswagen models in 2012 at its Nizhny Novgorod facility; annual output is planned at more than 100,000 units. The company also starts assembly next year of the Chevrolet Aveo on behalf of General Motors. GAZ is investing EUR85m (US$115m) in VW production and a further EUR10m in Chevrolet production.

In 2013, GAZ plans to start mass production of GAZelle Next light commercial vehicles and assemble 25,000 Mercedes Sprinter vans for Daimler.

The group’s investment programme is planned at  RUB10bn (US$326m) in 2012 and up to RUB7bn in 2013, the group’s financial director Yevgeny Belinin said.