Japanese Experts to Oversee Improvements in Russian Auto Manufacturing

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The Japanese Association for Trade with Russia has announced that a team of auto component experts will work closely with twelve Russian auto component manufacturers to assist with technology transfers and quality control standards in the Russian auto sector.

The co-operation, first mooted at last year’s summit between Japanese Prime Minister Shinzo Abe and Russia’s President Vladimir Putin, will see Japanese teams evaluate and introduce improvements in twelve Russian auto component manufacturers, with Russian engineers also spending time in Japan to evaluate Japanese standards.

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Likewise, Asian auto manufacturers are keen to cooperate with their Russian counterparts, as Russia possesses strong diplomatic and trade ties with much of Central Asia, as well as significant markets in Iran and elsewhere. Improving economic conditions in these regions are beginning to reflect in local consumers wanting access to new vehicles as well as upgrading from motorcycles to cars. Russia is seen as key to help develop this Central Asian auto potential.   nissan_x-trail

The largest Russian automotive company is Avtovaz, located in Tolyatti. It employs more than 130,000 people, and its Lada models dominate the Russian car market. Avtovaz models account for about 50 percent of Russia’s total car production. Russia’s second largest car manufacturer is Avtotor, located in Kaliningrad.

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Avtotor performs full-cycle assembly of foreign models, such as BMWKia, General Motors‘ Cadillac and Chevrolet vehicles. Avtoframos, the third largest car manufacturer, is located in Moscow. The company is a joint venture between France’s Renault and the Moscow city administration, but is majority owned by Renault.

The company manufactures Renault Logan and Renault Sandero models, with a ratio of 74 percent using Russian-made parts. The fourth and fifth largest car makers in Russia are Volkswagen and Ford, respectively. In total, the five largest companies of the industry account for 80 percent of all cars made in Russia.

Both Nissan and Toyota also have factories in St. Petersburg, with the quality control upgrading initiative designed to improve the Japanese share of the Russian domestic and future auto export markets.
 

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Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Eurasian region. We maintain offices in Moscow and St.Petersburg through our Russian partner firm, as well as our own offices in China, South-East Asia and India. For assistance with Russian issues or investments into Russia and Asia, please contact us at russia@dezshira.com or visit us at www.dezshira.com

 

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