GM and Ukraine Still Possible Partners

11/26/96

Reuters has reported that GM is still interested in becoming a partner in a joint venture with the state-owned AvtoZAZ plant which makes the Tavria car in Ukraine. The announcement comes after the Ukrainian government reversed its decision to back GM alone as preferred partner for the plant.

Greg DeYonker, executive vice president of GM Overseas, announced that he had met with Ukrainian President Leonid Kuchma on November 14 to reaffirm the goals of their relationship. In late October Ukraine's Prime Minister Pavlo Lazarenko reversed an earlier decision to back only GM as sole potential partner for AT AvtoZAZ. GM had already committed to a participate in a $500,000 feasibility study of the partnership.

DeYonker said, "We reaffirmed that we have a joint understanding just to complete the feasibility study by the end of the year and then to sit down and analyze whether an investment in Ukraine makes sense."

GM has begun to invest a total of $200-$250 million in Russia's Tatarstan. The investment will outfit a factory to produce 50,000 Blazer luxury off-road vehicles.

Paul Dever -- The Auto Channel