AutoSib

XXIth International Specialized Exhibition of automobiles & vehicles, spare parts, car accessories, expendable materials, equipment, auto-service & auto-tuning. Auto-retro Festival.

May 24 - 27, 2011

ITE Siberian Fair, Novosibirsk, Russia

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27.01.2010 • The government toughens conditions of the “preferential assembly regime”

Ministry of industry and trade and Ministry of Economics toughened “preferential assembly regime” of foreign cars in Russia which allows foreign auto companies to import auto components into Russia for assembly of cars under preferential custom duties in exchange for the obligation to create capacities of welding and coloring of a body of the car within 4.5 years and also to reduce the list of imported components by third.
The newspaper "Kommersant" writes that now foreign auto companies cannot use preferential import regime of components for models which are assembled not in full cycle of manufacture without taking obligations to start it in the future. Besides, companies will report about volumes of investments into development of the Russian factories once in half a year instead of once a year as now. However, toughening of “preferential assembly regime” will refer only to those companies which only plan to start manufacture in Russia: this is Hyundai and also Peugeot-Citroen and Mitsubishi. But ministries have no right to reconsider conditions of already concluded investment agreements.
Toughening “preferential assembly regime” ministries insure themselves against non-observance by companies of localization obligations in crisis. Great volumes of car production are necessary for creation of manufactures of components and the car market of Russia shows one of the strongest fall (by 50%) in the world. Besides, foreign companies which receive state support in their countries, invest abroad reluctantly. However, till now localization obligations were performed. According to data of car manufacturers which are resulted in the report “Assembly and localization of foreign cars in Russia”, for today "Avtoframos" reached the highest level of localization - its Renault Logan is localized more than by 40%, the Vsevolozhsk Ford reached a 30 percent index, "IzhAvto" localized 20% of components for KIA Spectra. Sollers for FIAT Ducato buys from 32 to 50% of components at Russian enterprises depending on a version, about 14% of auto components from the Russian suppliers are used in manufacture of off-roaders SsangYong. The level of localization is much lower at other enterprises working in regime of industrial assembly that is explained by later terms of realization of their projects.

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