Global automotive supplier Magna International and Russian carmaker Avtotor Holding Ltd. have announced the signing of a cooperation agreement to establish an automotive manufacturing cluster in Kaliningrad, Russia. Avtotor and Magna executives were joined by Russian Government officials for the official signing of the agreement.
Once complete, the project is expected to combine new vehicle production factories and several new joint ventures for automotive components production. It is anticipated that up to six full-cycle vehicle assembly operations for different automakers and up to 15 automotive components production plants will be set up in Kaliningrad.
Magna will support Avtotor in the conceptual design and technical preparation of the automotive cluster and may possibly serve as partner for the localisation of the components production in the Kaliningrad region.
“Russia is an important automotive market with the potential to become the largest market in Europe,” stated Guenther Apfalter, President Magna Steyr. “We look forward to working together with Avtotor to support the establishment of the automotive cluster in Kaliningrad.”
Avtotor is Russia’s largest maker of foreign-branded cars, assembling some 32 foreign models for brands such as BMW, Cadillac, Kia, Opel and Chevrolet. The company accounted for 21% of the 1.1 million foreign models made in Russia in 2011 and is expected to produce around 251,000 this year.
The automotive components facilities will produce parts for Avtotor’s needs, and may also supply to other Russian automotive companies as well as export parts to other countries.
“Avtotor regards this project as a new effective model for cooperation between the participating international companies and automotive suppliers,” stated Vladimir Scherbakov, Chairman of Avtotor. “In addition, we hope to contribute to a more rapid growth of bilateral trade, investments and the creation of new jobs in the Kaliningrad region.”
The final production capacity in the new cluster is expected to increase throughout several phases with the potential to reach up to 250,000 vehicles per year by 2018, with an annual product output expected of over 300 billion rubles (approximately $10 billion).
Posted by: Paul Whittaker, Editor ipmd.net, [email protected]