Car production at the PSMA Russian plant was established by the Automobile Technologies company, created in March 2023. It imports components, rents production facilities from PSMA Rus, and part of the work is performed by plant employees under the contract.
Medium-sized crossovers are assembled using large unit assembly technology (SKD4 from the 800 component group): bodies are delivered to Russia welded and painted, but not assembled. Delivery of vehicle kits from China is carried out by rail.
An assembly line was launched at PSMA Rus; Glass is glued to bare bodies, wiring harnesses are laid, and internal elements and components are assembled.
A few cars from the combined pilot batch will not be available for free sale, they plan to work on quality control issues and correction of deficiencies that are likely, since the plant has not produced cars for about two years.
“Automotive Technologies” is currently in the process of certification of the car that entered the production line. A full Vehicle Type Approval (VTA) is issued for transit and upon receipt of it it will be possible to raise the issue of exclusion from the list of those allowed for parallel imports.
The company considers it inappropriate to import vehicle kits using the simplified procedure provided for in government decree No. 855, since the validity period of this document cannot be extended.
Why crossover?
Automotive Technologies explains its choice of a mid-size crossover for the resumption of production due to the faster certification procedure of this type of car compared to other models.
It turned out to be impossible to restart highly localized cars previously produced at the plant due to the need to redevelop, test and implement components, especially electronic components, which could not be used due to sanctions.
Mass production of the crossover is planned to start in March, and sales are scheduled to start in March-April 2024.
The expected price of the new product is 4 million rubles,
if external conditions (ruble exchange rate, key rate of the Central Bank) do not change.
In the next stage, it is planned to connect the welding and painting lines to production. This may be the case if demand for cars is high and production volumes need to be increased. PSMA Rus plans to start production of another SUV of similar size and class in spring 2024. Future plans include restarting engine production as well as restarting commercial vehicle production.
The factory was idle
The resumption of car production at the PSMA Russian plant is most likely an initiative of the local government, but it is most logical that commercial vehicles demanded by the market will be assembled in Kaluga. Independent automotive industry consultant Sergei Burgazliev said there is more competition in the mid-size crossover segment.
“The market is in dire need of commercial vehicles, well-heeled delivery vans or larger commercial vehicles in the Fiat Scudo format. Moreover, the PSMA Russian factory had done these before. There is an understanding of how to produce such cars,” Burgazliev said in an interview with socialbites.ca.
He added that the chances of another expensive crossover being able to successfully compete with the large number of Chinese cars in the same class are extremely slim.
“There are almost no light delivery vehicles in China that can be used as “donors.” On the other hand, components of the same Peugeot Partner or Fiat Doblo Panorama in previous generations are produced for different markets.
“You can try to put together such a kit and sell it to Russia on behalf of a Chinese company,” he said.
– said Burgazliev.
Maxim Kadakov, editor-in-chief of Za Rulem magazine, noted that there is a significant need for light commercial vehicles in the Russian market, and the problem of the high price of such vehicles for corporate customers is no less serious than for private customers.
“We should have started with more popular market cars, but the company had no other faster options. “The main task will be to sell so many crossovers, because it is not a problem to make them,” Kadakov told socialbites.ca.
He believes that the ability to start production of more popular passenger cars and light commercial vehicles will depend on the general reaction to the resumption of work at the PSMA Russian plant, including in the West and China.
“The price of 4 million rubles is too high.
If we talk about passenger cars, there is demand in Russia for cars in the 1.5-2 million ruble segment, but it is difficult, almost impossible to break into this niche,” Kadakov said in an interview with socialbites.ca.
Commercial delivery vehicles, ambulances and passenger vans are a better option. He added that they were bought to make money and that their prices “will level out.”