CompaniesAvtovaz PAO – AVAZ.MM – DELISTEDFollowBayerische Motoren Werke AGFollowChery Automobile Co LtdFollowShow more companiesJuly 20 (Reuters) – The relaunch of a classic Soviet-era car, the Moskvich, by a state-owned company in November was celebrated by Moscow’s mayor as showing the resilience of Russia’s auto industry to Western sanctions.
“This is a historic event,” Sergei Sobyanin said as the Moskvich was unveiled at a factory the Moscow government took from French carmaker Renault (RENA.PA) last year for just one rouble ($0.01). “Many people thought it was the end of the Russian car industry.”
But the rebirth of the Moskvich is also a sign of China’s growing sway over an important sector of Russia’s economy.
The cars rolling out of the vast Moscow Automobile Factory Moskvich in the south of the Russian capital bear no resemblance to the boxy metallic Moskvich models of the Soviet era.
The sleek four-door SUVs featured engine parts and upholstery from China’s JAC Motors, clearly visible. Two sources, who asked not to be identified as they are not authorised to speak to the media, told Reuters the Moskvich 3 model is a JAC Sehol X4 assembled in Moscow using kits purchased from a Chinese partner.
Moskvich said in a statement last month its 3 and 3e models are produced using large-unit assembly – where cars are built at a manufacturing plant abroad, before being exported and finalised in Russia. The company said it works with a “foreign partner” but did not confirm ties to JAC.
“Production localisation is gradually increasing,” Moskvich told Reuters, adding that it hopes to start a second production phase later this year or early in 2024 involving welding and painting at the Moscow plant, incorporating a wider pool of local suppliers with Russian components.
JAC, based in the eastern province of Anhui, did not respond to requests for comment.
Chinese carmakers are seizing market share in Russia, capitalising on the departure of Western players that used to dominate the market before the invasion of Ukraine, auto industry data shows.
Imported Chinese cars now account for 49% of Russia’s market, reaching 40,000 units in June, compared with a pre-war share of just 7% in June 2021, according to data from analytics firm Autostat.
It is a lucrative business. Chinese carmakers’ exports of passenger cars to Russia in January-June 2023 increased 6.4 times year-on-year to almost $4.6 billion, according to Chinese customs statistics published on Thursday, including exports worth more than $1 billion in June alone.
Beyond these figures, Chinese firms are also increasing their sales in Russia with vehicle assembly at factories vacated by the likes of Renault and Nissan (7201.T), Reuters found.
Reuters spoke to two companies and four sources familiar with the matter who said that six factories in Russia that were formerly owned by European, Japanese and U.S. carmakers or assembled their vehicles are now producing Chinese models or have plans to do so. read…
Source from www.reuters.com