Geely Production In Russia Halted By Higher Tax

Shanghai, March 16, 2009: (Gasgoo.com) Production of Geely vehicles at Ural Automobiles and Motors in Russia has been suspended for at least 9 months due to the introduction of new import duties on auto parts, Russia media reports.

Russian newspaper Kommersant said Ural Automobiles and Motors has completely stopped production of Geely's Otaka sedans and Landmark SUVs because of a 35% duty rise on imported auto parts, which was issued by the Russian government this January to protect its domestic motor industry.

"We plan to resume production after the taxes expire nine months later," said Paul Chernavina, president of Ural Automobiles and Motors.

Ural began assembling semi-knock-down (SKD) kits of Geely Otaka and Landmark in May 2007 and now the company has a production capacity of 18,000 Geely vehicles a year, of which 4,000 were Landmark SUVs and 14,000 were Otaka cars. Total investment in the project amounts to $100 million.

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