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RENAULT IN RUSSIA

Renault has been present in Russia since the early 20th century. In 1998, it expanded the sales base for its vehicles in this country by setting up Avtoframos. Ten years on, Renault has signed a strategic partnership with AvtoVaz.
The aim is to keep pace with Russia’s strongly growing automotive market, which is on the way to becoming Europe’s biggest.

A changing economy, a fast growing automotive market 

Russia has seen continuous growth since 2000, making it a highly attractive destination for private foreign capital. The automotive sector is one of the first to reap the benefits of this investment.

 

Despite the financial crisis, all the signs point to continued strong growth of the automotive market. Household income in Russia is growing 10% a year. At the same time, car ownership stands at just 200 vehicles per 1,000 people, and is expected to increase 50% over the next three years. Vehicle sales grew by 36% in 2007. If the trend continues, Russia will overtake Germany as Europe’s biggest market. This explains why vehicle manufacturers are rushing to set up bases in Russia. A strategic choice made by Renault in 1998.

From the founding of Avtoframos to commercial success 

Although Renault has been present in Russia since 1907, it was in 1998 that a milestone event occurred. In association with Moscow city authorities, the Group founded Avtoframos, a company under Russian law, to make and sell Renault vehicles in Russia.

 

In 2003, Renault invested €230 million to produce and sell Logan under the Renault brand. In 2006, Renault increased its stake in Avtoframos to 94.1%.

 

Today, Renault’s investment is paying off. The Group sells a significant part of its range in Russia, alongside Logan and, for the first time, sales have topped the 100,000 mark (of which 67,844 Logan vehicles).

AvtoVAZ, a new strategic partner 

Logan, a success in Russia

To build its presence in Russia, Renault signed a strategic partnership in 2008 with AvtoVAZ, Russia’s leading vehicle manufacturer.

 

AvtoVAZ is an entry-level full-line manufacturer. It produces Lada brand vehicles and supplies 70% of domestic production.

 

The partnership pursues three main objectives:

  • accelerate the growth of AvtoVAZ, by renewing its range,
  • develop the Lada brand and maintain its leadership on the Russian market,
  • exchange know-how and technologies (production, marketing).

 

This agreement also gives Renault access to available production capacity. Russia is on its way to become Renault group’s biggest market.

 

 


Russia in brief (2007 figures)
 

  • Capital: Moscow

  • Area: 17 million km² 

  • Population: 143 million 

  • GDP: US$ 1,291,011 million

  • Roads: 952,000 km

 

Renault in Russia: key facts

 

  • 25% stake in AvtoVaz, Russia’s leading vehicle manufacturer.

  • 100,000 Renault vehicles sold in Russia in 2007, an increase of almost 40%.

  • Production capacity of 1 million vehicles/year in the AvtoVaz, Togliatti plant.

  • A network of 74 dealers and 115 sales outlets.

Also on Renault.com