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STRATEGIC PARTNERSHIP WITH AVTOVAZ

In February 2008, AvtoVAZ and Renault signed a strategic partnership. The aim was to accelerate the growth of AvtoVAZ, to renew and expand its vehicle range, to develop the Lada brand in order to consolidate its leading position on the Russian market and finally to create value for the Renault group.

AvtoVAZ, Russia’s market leader  

AvtoVAZ is Russia’s No. 1 vehicle manufacturer with a 23% share of the local market. It has the capacity to produce more than 1 million vehicles/year.

 

AvtoVAZ is an entry-level full-line manufacturer. It has a range of 15 models including Lada Kalina, Lada Priora and Lada 4х4. In 2009, AvtoVAZ produced 294,737 vehicles (including 34,756 for export).

 

By becoming a major shareholder in AvtoVAZ with a stake of 25%, Renault is consolidating its presence on Russia’s fast-growing automotive market.

Renault-AvtoVAZ: a win-win agreement    

The alliance between Renault and AvtoVAZ is strategic for both partners.

 

Accelerate the growth of AvtoVAZ and strengthen its brand image

 

  • AvtoVAZ will use Renault’s vehicle platforms and transmissions to renew the technologies used by the Lada brand.
  • AvtoVAZ will take advantage of synergies with Renault-Nissan Purchasing Organization (RNPO) to obtain better quality from its suppliers.

 

Create value and boost Renault’s growth on the Russian market

 

    The first two licenses were sold to AvtoVAZ for €220 million. Other licenses could also be sold, thus increasing cash flow for Renault in the short term and economies of scale in the medium term.

Shared governance 

The partnership has a joint Strategic Committee for coordinating joint activities, since each company remains independent. The alliance seeks to respect the values and entities of the two groups.