AvtoVAZ is exploring with partners from allied nations the possibility of producing vehicles in segments not currently covered by any Russian plant. Maxim Sokolov, the head of AvtoVAZ, discussed the topic during an interview with Forbes magazine.
“We remain an open company. At present, discussions are underway about assembling C- and D-class cars at a site that could include Izhevsk, in collaboration with friendly-country partners,” he stated.
Experts interviewed by Socialbites.ca suggest that Chinese automakers appear to be the most likely partners for such an initiative.
Specifically, Chinese firms JAC and Dongfeng are often cited as primary candidates for AvtoVAZ’s collaboration. KamAZ already works with JAC, Evolute has a link with Dongfeng, and these existing connections reinforce the sense that a broader alliance could form.
“That’s the overall impression,” notes Sergey Burgazliev, an independent automotive consultant quoted by Socialbites.ca. “Such products are strategically needed.”
Among Dongfeng’s lineups, the IX7 stands out as a crossover aligning with the segment mentioned by AvtoVAZ’s leadership. An expert points to the A9 sedan, produced by the same brand, as an example of a vehicle in the same space as the Toyota Camry, which previously exited the Russian market. The A9 is described as a vehicle exceeding five meters in length and equipped with a 1.8-liter turbo engine generating 204 horsepower.
If an agreement is reached, initial production would likely rely on a “kit assembly” or CKD/SKD approach for about the first year and a half, since AvtoVAZ’s current capabilities are not primed for manufacturing vehicles of this size. This constraint is particularly pronounced in the paint and finishing area.
At the same time, the plan would see the C- and D-segment models eventually rolling out under the Lada brand.
Igor Morzharetto, a partner at the Avtostat analytical agency, points out that the market niches targeted by these models are in need of sedans to refresh corporate fleets in Russia.
“Russia primarily requires sedans—tens of thousands if not hundreds—to update taxi fleets and fleets used by state and municipal transport agencies,” Morzharetto explains. “There are many state-owned companies too.”
Morzharetto adds that a dedicated customer base will need time to adapt to new brands and recognize the high quality of the products. He argues that Chinese automakers are weighing entry into the Russian market, potentially delivering cars via local assembly. This rationale helps explain the emergence of local brands such as Moskvich and Evolute in Russia. He also suspects Chinese partners fear secondary sanctions.
“FAW does not operate directly in Russia as it is state-owned, and Dongfeng has significant ties to Peugeot-Citroën and other global automakers, so it does not operate directly either. Overall, there are about 120 major Chinese automakers willing to take risks.”
Among the big three Chinese automakers, only Chery does not yet have a domestic production footprint in Russia. Haval runs a factory in the Tula region, while Geely manufactures cars in Belarus. Maxim Kadakov, editor-in-chief of Za Rulem, says that Chery’s entry at AvtoVAZ is theoretically possible.
“Chery offers a broad model range, including both crossovers and sedans such as Arrizo 7, which did not enter the Russian market due to the pandemic. But business viability must be assessed, because setting up production is a sizeable investment,” Kadakov notes to Socialbites.ca.
He adds that SKD assembly is less favorable due to tax considerations that approach the cost of new cars, and machinery reconfiguration would be necessary to establish production.
Arrizo 7 and Arrizo 8 sedans are among the potential options. If the retail price can be kept around 1.5 million rubles, the case becomes compelling, Kadakov suggests.
Should the Dongfeng A9 replace the Toyota Camry, Burgazliev believes the model could perform well in the market if it is roughly 15 percent cheaper than the Toyota model.
“If the car targets the D-segment like the Camry or Teana, the optimal price range would be about 2.2 to 3 million rubles. For lower-class vehicles, a price reduction of roughly 500 thousand rubles would be advantageous,” she estimates.
Sergey Tselikov, general manager of Avtostat, notes a current severe shortage of cars across most segments and argues that the industry cannot fully meet market demand under present conditions.
“Friendly countries with automotive expertise include China, where the sector is deeply rooted, and India in theory. However, collaboration with Chinese partners seems most likely,” Tselikov agrees with the other experts.