Modified: February 06, 2013 4:55 PM
Chevrolet looks to GAZ to help it keep Russia lead
General Motors Co. is hoping its production alliance with Russia's GAZ Group will help Chevrolet remain the country's top-selling foreign brand.
GAZ started making the Aveo sedan on Tuesday and will begin assembling the hatchback variant in late March with a goal of 30,000 producing units of the subcompacts this year.
"In 2012, Chevrolet was the most popular foreign car brand in Russia for the sixth year in a row. Our strategic goal is to strengthen Chevrolet's position in this market," GM Russia President Jim Bovenzi said in a statement.
$29 million invested
The Aveo is being assembled from complete knocked down (CKD) kits on two shifts at GAZ's plant in Nizhny Novgorod, which is about 400km east of Moscow. The companies spent $29 million to prepare GAZ's passenger car plant for the Aveo.
GAZ welds, paints and assembles the Aveo with the help of employees who received training at GM plants in Korea and St. Petersburg, Russia.
Chevrolet outsold Renault in Russia last year 205,042 vehicles to 189,852 to earn the title of top foreign brand, according to data from the Moscow-based Association of European Businesses. The overall market leader was domestic champion Lada with 537,625 sales. Lada is part of AvtoVAZ, which is now controlled by Renault-Nissan.
Turnaround
The GM deal is part of GAZ Group CEO Bo Andersson's turnaround of the company, which nearly collapsed before he arrived in 2009.
The former GM purchasing chief ended unprofitable car production at GAZ and then won contract manufacturing deals with the GM, Volkswagen Group and Daimler. GAZ assembles the Yeti small SUV for VW Group Czech subsidiary Skoda. This year, GAZ will begin producing the redesigned Skoda Octavia hatchback and VW Jetta sedan. Total production for VW is expected to reach 110,000 units a year.
GAZ also will produce 20,000 Mercedes Sprinter commercial vans annually starting this year.