Renault and AvtoVAZ confirm their strategic partnership

MOSCOW - Serguey Chemezov, Head of Russian Technologies, Chairman of the Board of AvtoVAZ, Anatoli Issaļkine, Head of Rossoboronexport, Boris Alyoshin, President of AvtoVAZ, Ruben Vardanian, President of Troika Dialog Group Limited, Serguei Skvortsov, President of Troika Capital Partners representing Troika Dialog Investments Limited and Carlos Ghosn, President and CEO of Renault signed several agreements confirming the strategic partnership between AvtoVAZ and Renault. • Renault will invest 1 billion US dollars for 25% + 1 share of AvtoVAZ’s shares*.

These agreements, which ensure the implementation of the strategic partnership announced on December 8, 2007 would allow AvtoVAZ and Renault to:

Accelerate the development of AvtoVAZ, renew and expand its vehicle range

Grow the Lada brand while respecting its identity, in order to maintain its leadership

Share technological expertise and know-how.

Russian Technologies and Renault will become equal shareholders of AvtoVAZ in the spirit of a long-term partnership. Once the capital of AvtoVAZ has been restructured in the first half of 2008, Russian Technologies and Renault will each own 25% + 1 of the ordinary and preferred shares of the company. AvtoVAZ and Renault will share know-how and technology particularly in relation to manufacturing and marketing and with the aim of improving the attractiveness, competitiveness and overall quality of AvtoVAZ’s products. AvtoVAZ will benefit from Renault’s contributions in relation to platforms and power trains in order to rapidly renew and enhance the entire Lada product line. The first Lada vehicle to come from this partnership could be commercialized at the end of 2009.

Sales volumes of Lada vehicles, in agreement with AvtoVAZ, will be consolidated by Renault. Consequently, Russia will become the Renault Group’s main market.

After March 1st **, and in order to optimize integration and boost the transformation of AvtoVAZ into a global automotive player, Renault shall propose five executives to join the executive committee of AvtoVAZ, four of whom come from Renault and one from AvtoVAZ:

Chief Operating Officer - Yann Vincent

Executive Vice-President, Plan, Product Planning and Programs - Hugues Desmarchelier

Senior Vice-President, Controlling - whose name will be announced later

Executive Vice-President, Purchasing - Christian Muller

Executive Vice-President, Engineering - Maxim Nagaytsev

Renault shall be attributed three of the twelve seats on the Board of Directors of AvtoVAZ and will be represented by Carlos Ghosn, President and CEO of Renault, Patrick Pelata, Executive Vice President, and Thierry Moulonguet, Executive Vice President. Renault and AvtoVAZ shall rely on a Joint Strategic Committee to decide the strategy and coordinate the activities common to both companies, each of which retains its autonomy of decision-making and strategic orientation.

*This amount does not include the payment of a supplementary price (earn out) to be fixed according to AvtoVAZ’s financial performance in 2008 - 2009.

** Upon approval of the European Commission.