Publication: Monitor Volume: 2 Issue: 186

Russia’s GAZ automobile plant is moving into CIS countries by establishing assembly plants in partnership with local firms which had previously functioned mainly as repair plants for Russian-made cars. GAZ joint ventures became operational and produced their first cars on October 4 in Chisinau, Moldova, and on September 21 in Almaty, Kazakhstan. GAZ also established joint ventures in the Ukrainian cities Kremenchug and Simferopol recently. The Chisinau plant has a production capacity of 2,000 vehicles for the first year, while the Almaty plant is projected for 2,500 to 4,000 vehicles after the first year. All these ventures will focus on assembling the GAZ company’s successful Gazelle light truck, with a carrying capacity of 1.5 tons, for both local use and export to Balkan and Central Asian countries. (Itar-Tass, Interfax, September 21 and October 4)

GAZ, located in Nizhny Novgorod, appears to be the first Russian manufacturing plant to be poised for a breakthrough in CIS countries. The company calculates that assembling the vehicles inside the potential market makes it possible to lower the sale price and capture the market. The offer looks attractive to the host countries because it promises to capitalize on a pre-existing technological base, revitalize and upgrade production capacities, re-employ their idled workforce, supply these countries’ markets with affordably-priced vehicles, and generate export revenue.