Soviet-era Russian car-maker to return with help from China – report
Two decades since it went bankrupt, Soviet-era car company Moskvich is planning a revival in Russia – reportedly partnering with Chinese car-maker JAC to produce vehicles amid the exodus of mainstream brands.
Soviet-era car-maker Moskvich reportedly plans to return to Russia – with help from a Chinese auto giant – amid the exodus of mainstream vehicle manufacturers from the region following Russia's attack on Ukraine.
According to overseas reports, Moskvich is planning to ramp up production of Chinese-developed vehicles at a Russian factory previously owned by Renault, which was one of the auto companies to flee the region in the wake of the conflict.
News agency Reuters has reported Moskvich is understood to have partnered with Chinese car brand JAC.
Insiders told Reuters the company was planning to manufacture a JAC SUV under the Moskvich badge.
"We have ... a long-distance partner we are working with," Maxim Klyushkin, a project manager reportedly told the Reuters news agency. "We are not naming that partner."
In May 2022, it was reported Russian truck maker Kamaz would revive Moskvich, with the company operating out of Renault’s former factory – now known as the ‘Moscow Automobile Plant Moskvich’.
In July 2022 Kamaz claimed it would produce 600 cars before the end of this year (including 200 electric cars) before expanding to 50,000 vehicles in 2023, followed by up to 100,000 examples in 2024.
Kamaz expects electric cars to account for 20 per cent of Moskvich’s sales in its first two years of operations, with the company planning to produce four SUVs and one sedan.
Founded in 1929 as KIM by Russian parent company AZLK, Moskvich produced small cars for the Russian market from 1945 until the brand filed for bankruptcy in 2002, having struggled since it was privatised in 1991 following the dissolution of the Soviet Union.
In 1999, French carmaker Renault purchased a stake in Moskvich’s Moscow factory, later buying the facility in 2005 as a part of a joint venture with Russian automotive company AvtoVAZ (parent company of Lada).
Earlier this year, Renault sold its 68 per cent stake in AvtoVAZ for just 1 Ruble – equivalent to $AU0.02 at the time – after sanctions were placed on Russia due to its invasion of Ukraine.
Russia’s car industry has been crippled since trade sanctions were placed on the country in March this year following the invasion of Ukraine.
According to new-car sales data from MarkLines, there were more than 1.66 million cars sold in Russia last year. From January 2022 to the end of October 2022, just 500,000 new cars were reported as sold in the country.
Since March 2022, eight major automotive companies have abandoned Russia, including Ford, Mercedes-Benz, Toyota, Honda, BMW, Nissan, Mazda and Renault.
Toyota – the world's biggest car-maker by sales volume – sold its Saint Petersburg factory in September 2022, and also announced it would no longer import cars to Russia.
On 12 October 2022, Nissan offloaded its shares in its Russian division to a state-owned institute for €1 ($AU1.55).
Last month, both Mercedes-Benz and Ford announced their exits, selling their Russian operations to a local investor and joint venture partners, respectively.
Mazda departed Russia earlier this month, also selling its local operations for just for €1 ($AU1.55).
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