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07. September 2010

GM may double capacity in Russia and in talks with GAZ

It is reported that General Motors may need to double production capacity in Russia to meet demand and is in talks with potential partners including billionaire Mr Oleg Deripaska GAZ Group.

Mr James Bovenzi GM Russia president and managing director said GM, which has the ability to make 180,000 cars a year in Russia would need to add capacity even after its St. Petersburg plant and a joint venture with AvtoVAZ reach peak output. He said that a final decision will depend on market demand.

Mr Bovenzi said at the Moscow International Auto Salon that "We really see the market now poised for growth. The bad things are behind us, and the crisis is behind us, and now the market is starting to improve."

He said that industry wide passenger-car sales in Russia will probably grow to 1.8 million vehicles this year from 1.5 million last year reaching 3 million by 2015. He added that Detroit-based GM will need to develop new projects in Russia. Talks are under way with GAZ Group controlled by Mr Deripaska Russian Machines.

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