Russian Automakers Unite To Raise Competitiveness

MOSCOW January 29. 2003; Anna Ivanova-Galitsina writing for Dow Jones Newswires reported that Russia's automakers joined forces Tuesday to raise competitiveness and boost investment in the sector, Russia's fourth-largest automaker OAO UAZ said in a statement Wednesday.

Members of the newly created Russian Automakers' Union reported either a fall in sales in 2002 or worse-than-expected growth. OAO Avtovaz is the union's largest member, OAO GAZ the second largest, truck-maker OAO Kamaz the third, and UAZ the fourth-largest member.

The union will liaise with state authorities and international organizations, as well as promote Russian vehicles abroad, UAZ said.

The union will place special emphasis on controlling vehicle quality, which is believed to be the main reason for a drop in popularity of Russian cars.

"Creation of the Automakers' Union is very good idea, providing their efforts don't just stay on paper," said Elena Sakhnova, automotive analyst at the United Financial Group.

"The companies can economize on joint acquisitions of technologies and be stronger lobby-wise," she said.

Other major industries are also represented by the union, such as the country's largest steel-maker OAO Severstal , the owner of UAZ and Kamaz, and Oleg Deripaska, half-owner of base-metals giant OAO Russian Aluminum, who owns GAZ. Representing the state is the super governor of the Volga region and former prime minister Sergei Kirienko.

In a separate statement, Kamaz reported that its business is improving already and that it will raise its production plans for 2003, Prime-Tass news agency said Wednesday.

Russian law-enforcement agencies have ordered heavy trucks from Kamaz, so it will no longer halt production for a week in both February and March, but may introduce a second shift instead, said the agency.

In February, Kamaz plans to sell 1,836 trucks, up from 1,086 in February 2002, the agency reported.

Company Web site: http://www.kamaz.ru