GM Leaves Russia, Bought Out by AvtoVAZ

Matt Posky
by Matt Posky
gm leaves russia bought out by avtovaz

Russia’s largest automotive manufacturer, AvtoVAZ, announced Monday that it plans to buy General Motors out of its regional joint venture. The duo previously assembled Chevrolet-branded automobiles for the local market; however, GM lost interest after the market took a turn for the worse.

While sanctions from Western nations and falling oil prices upended Russia’s economy a few years ago, it was already headed for hard times. Wages have stagnated and average citizens no longer possess the same level of buying power they held a decade earlier. The Russian Economic Development Ministry predicts just a 1-2 percent growth rate up to 2030 and leadership doesn’t seem terribly interested in improving the situation for the citizenry, deciding instead to raise taxes on just about everything. GM was probably right to get out.

According to Reuters, AvtoVAZ signed an agreement to buy General Motors’ 50 percent stake in the venture, which saw the two companies build the Chevrolet Niva from a factory in Togliatti. While the Russian firm did not disclose financial details, the purchase effectively leaves GM with nothing to do and ends its assembly commitments in the region.

The Togliatti factory will continue rolling out models under the Chevrolet brand for “a certain period of time” before switching to Russia’s Lada brand, according to the agreement.

The facility has a capacity of roughly 100,000 cars a year but it’s unclear as to how much of that cap will be utilized. The Association of European Businesses reported on Thursday that Russia’s new vehicle sales are down 6.4 year-on-year for 2019. Lada has also been struggling. In November, the company announced the sharpest decline it has endured in three years.

[Image: Evannovostro/Shutterstock]

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  • Thx_zetec Thx_zetec on Dec 09, 2019

    No wipers, no mirrors, rear visibility that makes you wish for a camaro, and a windshield almost flat for huge heat gain in the summer and poor visibility. Also see youtube video on towing with a model_x . . . 1.5 hours of charging for every two hours of driving,

  • Brn Brn on Dec 10, 2019

    TTAC, thank you for not equating the sign to a 'small child', like some other media outlets did.

  • Matt Posky I paid a little under $300 bucks per month to park in Queens and was told by everyone else with a car that it was a great deal. Parking in Manhattan is typically far more expensive to rent and often involves waiting 20 minutes while someone fetches your car. Unless it was a secure garage where you yourself have 24 hour access directly to the vehicle, and it was less than a block away, there is no scenario in which I would actually purchase a parking spot in Manhattan.
  • Jeff S VoGhost--He is a Russian troll.
  • GrumpyOldMan The weather protection of a motorcycle plus the bulk of a car.
  • Kcflyer in a world where Miata doesn't exist this still seems like an expensive limited use choice
  • Verbal Crusher bait.
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