MOSCOW, December 12, 2012, the Renault-Nissan alliance and the state corporation "Russian Technologies" have created a joint venture that will own all their shares in the authorized capital of OJSC "AVTOVAZ" and will become a stable, long-term controlling shareholder for the largest automobile company in Russia and owner of the LADA brand.
President of the Renault-Nissan Alliance Carlos Ghosn announced today the creation of the joint venture Alliance Rostec Auto BV at a ceremony in Moscow, together with the General Director of the Russian Technologies State Corporation, Chairman of the Board of Directors of AVTOVAZ Sergei Chemezov and President of OJSC AVTOVAZ Igor Komarov.
“Today’s historic agreement is a unique deal that benefits all three brands, Renault, Nissan and LADA, and will mark a new stage in successful cooperation,” said Mr. Ghosn. - "The joint venture will accelerate our development in Russia and will contribute to the competitiveness of AVTOVAZ, the leader of the Russian automotive industry."
In accordance with the terms of the deal, the Renault-Nissan alliance will invest 23 billion rubles (equivalent to 742 million US dollars). As a result of these investments, Renault-Nissan will receive 67.13% of the capital of the joint venture by mid-2014. After this, the joint venture will own 74.5% of AVTOVAZ.
Renault will invest about 11.3 billion rubles (366 million US dollars) in the joint venture. Renault plans to obtain 50.1% of the joint venture by June 2014. Nissan will invest 11.7 billion rubles (376 million US dollars). Nissan plans to obtain 17.03% of the joint venture by the same period.
In the same period, the Russian Technologies State Corporation will receive 32.87% of the joint venture.
At the time of completion of the transaction in 2014, the joint venture being created will purchase all shares of AVTOVAZ, which are now owned by Troika Dialog Investments Limited. The transaction is subject to relevant conditions precedent, which must be strictly complied with.
Together for economic growth in Europe
The Board of Directors of Alliance Rostec Auto BV will resolve strategic issues and objectives and will become a platform for discussion for the Renault-Nissan Alliance and the Russian Technologies State Corporation.
As part of the deal, Renault-Nissan President Carlos Ghosn will become Chairman of the Board of Directors of the Alliance Rostec Auto joint venture. The Board of Directors will include:
Three representatives from the Renault-Nissan Alliance: Dominique Thormann, CFO of Renault, Joseph Peter, CFO of Nissan, Bruno Anselin, Senior Vice President of Renault and COO of the Eurasia region;
Two representatives from the Russian Technologies State Corporation: Sergey Chemezov, General Director of the Russian Technologies State Corporation and Igor Zavyalov, Deputy General Director of the Russian Technologies State Corporation.
The AVTOVAZ Board of Directors will be expanded from 12 to 15 members. From the side of the Renault-Nissan alliance, it will include 8 representatives, whose candidacies must be approved by the Extraordinary Meeting of AVTOVAZ shareholders. It will take place on February 12, 2013. Sergey Chemezov will remain Chairman of the Board of Directors of AVTOVAZ, alternating in this post with Carlos Ghosn as Deputy Chairman of the Board of Directors since June 2013.
“The Russian automobile market is becoming a leader in Europe in terms of car sales,” said the corporation’s general director, Sergei Chemezov. - By 2020, AVTOVAZ, together with its partners, plans to reach an annual production level of more than 1 million cars, the quality of which will meet the highest world standards. Thanks to the partnership with the Renault-Nissan alliance, new modern and highly paid jobs will be created for residents of the city of Tolyatti and the Samara region."
The deal is concluded eight months after Russian President Vladimir Putin inaugurated a new production line at AVTOVAZ in Tolyatti, with a production capacity of up to 350 thousand cars per year. This line will become a platform for sharing automobile platforms. In the spring of 2012, production of the LADA Largus has already been launched at the production complex, and yesterday the production of the new Nissan Almera began, which will reach full capacity in the spring of 2013. In 2013, the plant will produce five models of three brands on this line - LADA, Renault and Nissan. Investments in this project will amount to about 400 million euros.
“Strengthening our partnership is a natural stage of our common work,” said AVTOVAZ President Igor Komarov. - Yesterday AVTOVAZ already became a multi-brand company - we started producing a car for Nissan in Tolyatti. Accelerating integration will improve the efficiency of overall efforts and increase market share."
Additional Information:
The AVTOVAZ Group is part of the Renault-Nissan-Mitsubishi Alliance and produces full-cycle vehicles and auto components for 4 brands: LADA, Renault, Nissan, Datsun. The Group's production facilities are located in Tolyatti - JSC AVTOVAZ and in Izhevsk - LLC LADA Izhevsk.
The LADA brand is represented in the B, B+, SUV and LCV segments, which make up 5 model families: Vesta, XRAY, Largus, Granta and 4x4. The brand occupies 20% of the Russian passenger car market. The official dealer network of the Brand is the largest in Russia - about 300 dealer centers.
Business, 11 March, 09:19
The media reported the possible closure of the Renault and Nissan plant ... Japanese agency Kyodo, citing sources. Ghosn headed the enterprise Renault-Nissan BV until he was arrested in Japan on November 19, 2018.... March 12 leadership Nissan, Renault and Mitsubishi will hold a joint press conference in Yokohama. Former head of the alliance Renault-Nissan-Mitsubishi is accused of hiding a total of $80 million in revenue. According to the prosecution, Ghosn also blamed Nissan their... Carlos Ghosn steps down as head of Renault ...removed from leadership positions in Nissan. Carlos Ghosn steps down as chairman and chief executive officer Renault on the evening of January 23, he said... . The board will be headed by Michelin President Jean-Dominique Senard. Ghosn, who also headed Nissan Motor, was arrested in Japan on November 19 on suspicion of concealing income and use of assets Nissan for private purposes. A couple of days later, the board of directors of the Japanese automaker... French authorities have denied reports of a possible merger between Renault and Nissan ... The mayor noted that France is committed to the proper functioning and durability of the alliance Renault And Nissan. The day before, the Japanese newspaper Nikkei wrote that the French government delegation... visiting Tokyo told the Japanese side that it would strive for unification Renault And Nissan to a holding company. According to the publication, due to the increase... The media learned about France's demand to merge Renault and Nissan ... the Japanese side, which will strive to unite the French automaker Renault with Japanese Nissan into a single holding company. This is reported by a Japanese newspaper..., Paris has renewed pressure for a merger. Nissan opposes, fearing that the French government, which is a shareholder Renault, will have the opportunity to influence the policy of the united... Senar. Now the two companies are forming an alliance, Renault controls 43% Nissan, and that one - 15% Renault. Former top manager Nissan Carlos Ghosn in December 2018... The joint venture between Renault-Nissan and Rostec became the sole shareholder of AvtoVAZ Alliance Rostec Auto B.V. - alliance joint venture Renault-Nissan and the state corporation Rostec - increased its share in AvtoVAZ to 100%... Chemezov spoke at the end of May. At that time the joint venture Renault-Nissan and Rostec owned 83.5%. In October, the company announced... Nissan postpones decision on new director Board of three external directors of the alliance Renault-Nissan-Mitsubishi postponed the question of candidacy for the head instead of the one arrested for concealment... formally remained as CEO Renault. In fact, Thierry Bolloré was appointed to perform his functions. Ghosn also formally remains the head of the alliance Renault-Nissan-Mitsubishi. thirty ... The Ministry of Industry and Trade did not consider Ghosn’s arrest a threat to the work of Renault-Nissan in Russia Alliance work Renault-Nissan-Mitsubishi in Russia and negotiations on concluding a special investment contract with AvtoVAZ..., TASS reports. “Decisions made by such a large company as an alliance Renault-Nissan, are accepted according to a certain procedure and never depend on one... according to the official, representatives of the alliance Renault-Nissan-Mitsubishi informed the Ministry of Industry and Trade about Ghosn’s arrest. Ghosn was arrested on November 19. IN Nissan came to the conclusion that he... The arrest of the head of Renault-Nissan-Mitsubishi was extended for ten days The Tokyo District Court extended the arrest of the head of the alliance Renault-Nissan-Mitsubishi Carlos Ghosn and top manager Greg Kelly for ten... Times citing sources on the board of directors Nissan, Ghosn planned to merge the company with Renault. It was supposed to happen within a few months. The day before, the French authorities proposed introducing temporary leadership in Renault. According to the company's website, Ghosn, who is "temporarily disabled... Nissan revealed details of the investigation against the alliance's CEO ... directors and general director of the alliance Renault-Nissan-Carlos Ghosn's Mitsubishi is suspected of reporting understated income. This is reported on the website Nissan. The automaker will continue to do this for... the message says. Chief executive officer Nissan Hiroto Saikawa will propose to the company's board of directors to fire Ghosn and Kelly... division Renault. In 1999 he became executive director Nissan after its merger with Renault, and in 2001 he rose to the rank of general director of the company. Nissan ... The head of the Renault-Nissan-Mitsubishi alliance was arrested in Japan ... Japan detained the head of the automobile alliance Renault-Nissan-Mitsubishi, one of the most successful managers of the global auto industry, Carlos Ghosn. Previously Nissan reported on an internal investigation... of one of the most famous auto industry managers in the world, the head of the alliance Renault-Nissan-Mitsubishi of Carlos Ghosn. This was reported by the Yomiuri newspaper and TV channel...Business, 29 March 2018, 15:42
Bloomberg learned about Nissan and Renault merger talks ...Gon. French Renault SA and Japanese Nissan Motor Co. are negotiating a merger to strengthen their alliance (known as Renault Nissan), writes Bloomberg since... months. Previously, Carlos Ghosn promised to make an alliance Renault And Nissan"irreversible". He resigned from his position as CEO Nissan in order to focus on unification... 10.7 million cars, Toyota - 10.4 million. Alliance representative Renault-Nissan in response to a request from RBC, it refused to comment on “rumors and speculation... Renault-Nissan Renault Renault-Nissan Renault Renault Renault-Nissan ... Co-owner of AvtoVAZ became the world's largest automaker ...with the recovery of demand in Russia. According to the results for the first half of the year, Renault-Nissan sold 5.268 million cars worldwide, reports Financial.... Car sales Renault worldwide grew by more than 10%, amounting to 1.879 million cars. Thus, Renault-Nissan became the largest producer... Renault from work in Russia amounted to €3 million. As the FT notes, Russia is now for Renault largest market after France. Joint venture Renault-Nissan ... Renault Renault Renault-Nissan AvtoVAZ postponed the second stage of the additional issue of shares worth more than 46 billion rubles. ... issue of securities,” the statement says. As a representative explained to Interfax Renault(owns 40.7% of the shares of the main shareholder of AvtoVAZ Alliance Rostec Auto... April 2018 inclusive," he said. According to the representative, in Renault expect the closed subscription phase to be completed by the end of 2017... Alliance Rostec Auto B.V. (a joint venture of Rostec and the alliance Renault-Nissan). As a result of the additional issue, the automaker can raise about 95.275 billion... ... clarified. IN Renault Renault-Nissan Renault-Nissan Renault-Nissan Renault-Nissan Renaissance Capital will sell its stake in AvtoVAZ ... clarified. IN Renault on Saturday, June 3, they did not respond to RBC’s request. Renaissance Capital declined to comment. Alliance Renault-Nissan and “Rostec...”. - RBC) - 51 billion rubles, Renault-Nissan- 32 billion rubles, as a result we will have 25% of the shares, Renault-Nissan- about 75%, the share of the joint venture (Alliance ... to the main shareholders and part-time creditors, that is, Rostec and Renault-Nissan. Thus, the circle of possible acquirers [of Renaissance shares] in general...Business, 27 March 2017, 19:19
Renault-Nissan Renault-Nissan Renault-Nissan. Valeria KomarovaBusiness, 27 March 2017, 19:19
Reuters reported plans to delist AvtoVAZ in 2017 ... participation of the investment bank Renaissance Capital, Reuters reported, citing sources. Renault-Nissan and the state corporation Rostec, which through Alliance Rostec Auto BV own... in a further transaction, Reuters sources do not specify. Now the joint venture of the alliance Renault-Nissan and Rostec owns 64.6%, and other security holders - 11... "subsequently can resell its stake in AvtoVAZ to the Rostec joint venture and Renault-Nissan.Business, 20 March 2017, 18:30
Renault-Nissan Renault-NissanBusiness, 20 March 2017, 18:30
AvtoVAZ shareholders approved an additional issue of 46.25 billion rubles. ... Rostec Auto B.V., through which the Rostec state corporation and the alliance Renault-Nissan own 64.6% of AvtoVAZ. As a result of the additional issue, the automaker may attract... years. “We will convert those loans that were made by the alliance Renault-Nissan, and Rostec. The alliance has about 34 billion rubles, and... Renault-Nissan Renault-Nissan Renault-Nissan, and Rostec. The alliance has about 34 billion rubles, and... The share of the main shareholder of AvtoVAZ decreased to 64.6% ... additional issue share of Alliance Rostec Auto BV (JV of Rostec and the alliance Renault-Nissan) decreased from 74.5 to 64.6%, as follows from the message... RBC) were distributed as follows: Rostec - 21.2% (was 24.5%), Renault-Nissan- 40.7% (was 47.04%). As RBC previously wrote, the second... year. “We will convert those loans that were made by the alliance Renault-Nissan, and Rostec. The alliance has about 34 billion rubles, and... Renault-Nissan Renault-Nissan Renault reset, and Renault Renault-Nissan - 25 ... Rostec converts all AvtoVAZ debt into shares ... 2017, we will convert those loans that were made by the alliance Renault-Nissan, and Rostec. The alliance has about 34 billion rubles, and... Chemezov. Explaining that this will complete the recapitalization process. Alliance Renault-Nissan and Rostec reported at the beginning of 2016 that they had begun... debt Renault reset, and Renault He also contributes additional money so that we [Rostec] still have a 25% stake plus one share, Renault-Nissan - 25 ... Bulten-Rus will produce fasteners for Renault-Nissan and AvtoVAZ ... "Bulten-Rus" became a supplier of fasteners for industrial projects of the alliance Renault-Nissan and AvtoVAZ (ARNPO), reports the press service of GAZ Group. "Contract for... AvtoVAZ's losses increased eightfold ... 200.4 thousand cars and assembly kits under the Lada brands, Renault, Nissan and Datsun - 30% less than a year earlier. Without taking into account... on the part of the shareholder - Alliance Rostec Auto BV (Rostec JV, Renault And Nissan), owning a stake of 74.51%. Interfax previously reported that... However, this requires the approval of the government and foreign shareholders - the alliance Renault-Nissan. AvtoVAZ's results for the first half of the year are quite expected due to the difficult... The State Duma proposed to simplify the legalization of car tuning ... in his address Romanovich. Soyuz-96 plant, producing accessories for automakers Renault, Nissan, Toyota, began to receive massive customer complaints, the head of the department told RBC... Enchanted generation: why our top managers are not welcome in emigration ... corporate CEOs emerging from emerging markets: Brazilian Carlos Ghosn in Renault Nissan, Indian Ajay Banga at MasterCard, Ivorian Tidjane Thiam at Credit... Renault-Nissan Renault Renault Renault Renault Renault AvtoVAZ will borrow 20 billion rubles. to pay for spare parts ....V., whose shareholders are Renault-Nissan(67.1%) and Rostec (32.9%). For what purposes does AvtoVAZ borrow money from Renault, in materials to... capital). In February, the plant's two largest shareholders - Renault and Rostec - announced their readiness to recapitalize AvtoVAZ. Renault promised to contribute money, Rostec - to capitalize part... including to pay off the debt to Renault", says the expert. Another option is a loan Renault will be converted into AvtoVAZ shares, the manager adds...Business, 15 March 2016, 14:23
Save from bankruptcy: what is the new president of AvtoVAZ Nicolas More famous for? ...,” the message quotes the words of the Chairman of the Board of Directors of AvtoVAZ and the President Renault-Nissan Carlos Ghosn. According to Rostec CEO Sergei Chemezov, whose words... structures Renault he has been working since 2000: he has worked his way up from director of procurement of spare parts and accessories to vice president Renault-Nissan on procurement... the results of AvtoVAZ’s work in 2015, the shareholders agreed to recapitalize the plant: Renault-Nissan will provide financial support, Rostec is ready to convert up to 52 billion rubles...Business, 29 Feb 2016, 02:32
The media reported on the search for a replacement for the head of AvtoVAZ, Bo Andersson. ... RBC was told that both AvtoVAZ shareholders were dissatisfied with Andersson’s work - alliance Renault-Nissan and the state corporation Rostec (both companies declined to comment). Previously... AvtoVAZ and its subsidiaries will continue to operate continuously.” Representatives Renault, Nissan and Datsun did not comment on a possible change in AvtoVAZ management, a representative... ... Renault And Nissan Renault and chairman of the alliance Renault-Nissan Renault-Nissan Renault-Nissan announced the release of cars with autopilot in the next 4 years ... Renault And Nissan announced that it will produce more than ten self-driving cars over the next four years. General Director Renault and chairman of the alliance Renault-Nissan... the highway is autonomous if there is no need to change lanes. Renault-Nissan this year will also launch an application for mobile devices, which... Renault Suppliers spoke about the suspension of the AvtoVAZ conveyor ... alliance Renault-Nissan. On Friday at AvtoVAZ there was an unscheduled stop of the B-0 line, where Lada Largus and alliance models are assembled Renault-Nissan - Renault Sandero, Logan and Nissan Almera, two suppliers of the Togliatti plant told RBC. By...The Renault-Nissan alliance, which took control of Mitsubishi Motors in October, sold 9.96 million vehicles in 2016, up 17% from the previous year. Nissan bought Mitsubishi Motors for $2.3 billion in October 2016 after the Mitsubishi fuel economy cheating scandal brought down the company's market capitalization. Last year, the alliance fell slightly short of the figures of the top three largest automakers - Volkswagen (10.31 million), Toyota Motor (10.18 million) and General Motors (GM; 10.01 million). In 2011–2015 Renault-Nissan sold 8–8.5 million cars a year.
Until 2008, GM led the global market for more than 70 years. Toyota overtook it in the crisis year and held the lead until 2016, only losing first place to GM for one year in 2011 due to problems with car production after the earthquake and tsunami in Japan. In 2016, Volkswagen, despite being rocked by a diesel emissions scandal in late 2015, overtook Toyota to become the world's largest automaker.
GM is in the process of exiting several markets it considers too unprofitable for itself, such as Europe and India. Toyota has stated several times that sales leadership is not the goal for the company, but the main thing is harmonious sales growth and profitability.
The Franco-Japanese group has become one of the few global players to outperform the industry average growth rate of 5.5% since the start of the decade. In 2016, more than 87.6 million passenger cars were sold worldwide, of which the four largest automakers accounted for 46.1%, WSJ reported.
Renault on Friday reported a record operating profit of 1.8 billion euros for the first half of 2017, with revenue rising 17% year-on-year to 29.5 billion euros. Carlos Ghosn said Renault's results provided a "solid foundation" for its next strategic plan, which will be presented in October.
In the Russian market, where the company previously suffered significant losses, profit for the half-year amounted to 3 million euros. The Russian car market has been hit hard by the economic crisis, but Renault has now adjusted its sales forecasts for it to more than 5% growth. “The market, which we did not consider strong, has recovered significantly,” the group's chief financial officer, Clotilde Delbo, told analysts. At the beginning of this week, another French automaker, Peugeot, increased its forecasts for the Russian market.
But Renault's weak profitability disappointed analysts, with the company's shares falling 7.2% on Friday, their lowest level since June 2016. Despite a 10% jump in sales, operating margin increased only 0.1 percentage point to 6.2%, and in the automotive division only up to 4.8% (by 0.1 p.p.). Renault's performance brought it into uneasy comparison with national rival PSA Group, which reported a 7.3% margin on relatively flat sales.
K:Companies founded in 1999
Activity
In China
In June 2003, a joint venture was created between the Chinese companies Dongfeng and the Japanese Nissan, Dongfeng Motor Company. The factory is located in Wuhan, China. The list of cars includes: Nissan Sunny, Nissan Bluebird, Nissan Teana and Nissan Tiida. By 2014, a number of vehicles are planned to be produced on the D automobile platform.
Daimler and Alliance
On April 7, 2010, to improve quality and exchange modern technologies, as well as reduce joint costs, the German company Daimler entered into a strategic agreement with the Alliance. As a first step, Daimler will acquire a 3.1% stake in Renault and Nissan, in turn Renault and Nissan will each have a 1.55% stake in Daimler. Thanks to joint procurement and the use of a large number of standard auto parts and modern technologies, companies will significantly reduce their costs. In this case, joint parts and technologies are aimed at mini car models: Daimler Smart and Renault Twingo
IN THE USA
In January 2012, the companies announced that they would jointly begin producing engines at Nissan's Tennessee plant for Mercedes-Benz.
In India
In 2010, the alliance opened its plant in India in Chennai to produce the Nissan Micra. The capacity of the new enterprise is 400,000 cars per year. As of 2012, the number of employees of the Indian plant was 6,000, including 457 managers, 810 quality controllers, 4,831 working operators, the average age of production workers was 24 years.
In Brazil
In early October 2011, the head of the alliance, Carlos Ghosn, met with the President of Brazil, Mrs. Dilma Rousseff, and announced that the alliance intends to increase its production in Brazil by 2016. In particular, the production of the existing Renault plant in Curitiba will be expanded and a new Nissan plant with a planned production and research center will be built
In Russia
In June 2012, the Renault Nissan Alliance began test assembly of Nissan Almera Classic and Nissan Bluebird Sylphy cars at the AVTOVAZ plant in Tolyatti. In 2013, serial production and sale of cars began.
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Excerpt characterizing Renault Nissan (alliance)
During my “walks” I met many different, wonderful visitors who came to visit the Holy Pope. These were cardinals and some very high-ranking persons unfamiliar to me (which I judged by their clothes and how proudly and independently they behaved with the others). But after they left the Pope’s chambers, all these people no longer looked as confident and independent as they had before visiting the reception... After all, for Caraffa, as I already said, it didn’t matter who the person standing in front of him was, the only important one for the Pope it was HIS WILL. And nothing else mattered. Therefore, I very often saw very “shabby” visitors, fussily trying to leave the “biting” Papal chambers as quickly as possible...On one of the same, absolutely identical “gloomy” days, I suddenly decided to do something that had been haunting me for a long time - to finally visit the ominous Papal cellar... I knew that this was probably “fraught with consequences,” but the anticipation of danger was a hundred times worse than the danger itself.
And I decided...
Going down the narrow stone steps and opening the heavy, sadly familiar door, I found myself in a long, damp corridor that smelled of mold and death... There was no lighting, but moving further was not a big deal, since I always had a good sense of direction In the dark. Many small, very heavy doors sadly alternated one after another, completely lost in the depths of the gloomy corridor... I remembered these gray walls, I remembered the horror and pain that accompanied me every time I had to return from there... But I ordered myself to be strong and don't think about the past. She told me to just go.
Finally, the creepy corridor ended... Having looked carefully into the darkness, at the very end I immediately recognized the narrow iron door behind which my innocent husband had once died so brutally... my poor Girolamo. And behind which eerie human groans and screams were usually heard... But that day for some reason the usual sounds were not heard. Moreover, behind all the doors there was a strange, dead silence... I almost thought that Karaffa had finally come to his senses! But she immediately caught herself - Dad was not one of those who calmed down or suddenly became kinder. It’s just that, at the beginning, he brutally tortured him in order to find out what he wanted, later he apparently completely forgot about his victims, leaving them (like waste material!) at the “mercy” of the executioners who tormented them...
Carefully approaching one of the doors, I quietly pressed the handle - the door did not budge. Then I began to feel it blindly, hoping to find an ordinary bolt. The hand came across a huge key. Turning it, the heavy door crawled inside with a grinding sound... Carefully entering the torture room, I felt for the extinguished torch. There was no flint, to my great regret.
“Look a little to the left...” a weak, exhausted voice suddenly rang out.
I shuddered in surprise - there was someone in the room!.. Fumbling along the left wall with my hand, I finally found what I was looking for... In the light of a lit torch, large, wide-open, cornflower blue eyes were shining right in front of me... Leaning against the cold stone wall, sat an exhausted man, chained with wide iron chains... Unable to get a good look at his face, I brought the fire closer and recoiled in surprise - on the dirty straw, all smeared with his own blood, sat... a cardinal! And by his rank, I immediately understood that he was one of the highest-ranking, closest to the Holy Pope. What prompted the “holy father” to treat his possible successor so cruelly?!.. Did Caraffa even treat “his own” with the same cruelty?..
– Are you very ill, Your Eminence? “How can I help you?” I asked, looking around in confusion.
I was looking for at least a sip of water to give the unfortunate man a drink, but there was no water anywhere.
“Look in the wall... There’s a door... They keep wine there for themselves...”, as if guessing my thoughts, the man whispered quietly.
I found the indicated cabinet - there was indeed a bottle stored there, which smelled of mold and cheap, sour wine. The man did not move, I carefully lifted him by the chin, trying to give him a drink. The stranger was still quite young, about forty to forty-five. And very unusual. He resembled a sad angel, tortured by animals who called themselves “men”... His face was very thin and delicate, but very regular and pleasant. And on this strange face, like two stars, bright cornflower blue eyes glowed with inner strength... For some reason, he seemed familiar to me, but I just couldn’t remember where and when I could have met him.
The stranger groaned quietly.
- Who are you, Monseigneur? How can I help you? – I asked again.
“My name is Giovanni... you don’t need to know anything else, Madonna...” the man said hoarsely. -Who are you? How did you get here?
“Oh, this is a very long and sad story...” I smiled. “My name is Isidora, and you don’t need to know any more, Monseigneur...
- Do you know how to leave here, Isidora? – the cardinal smiled in response. - Somehow you ended up here?
“Unfortunately, they don’t leave here so easily,” I answered sadly. “My husband couldn’t, at least... And my father only reached the fire.”
Giovanni looked at me very sadly and nodded, showing that he understood everything. I tried to give him the wine I found, but nothing worked - he was unable to take even the slightest sip. Having “looked” at him in my own way, I realized that the poor fellow’s chest was badly damaged.
With the acquisition of AvtoVAZ and its Lada brand, Renault-Nissan hoped to profit from the huge Russian market. But the crisis and local mores complicated the task.
When Nicolas Maure arrived in Tolyatti in February last year, he not only had to learn Russian, meet with representatives of local authorities and immerse himself in a pile of production papers... To his great surprise, the new French head of AvtoVAZ was offered to undergo a training program together with his bodyguards. In the Volga forests he was taught to use a machine gun. “I fired 500 rounds at the silhouettes of terrorists, and I had a bruise all over my shoulder,” he says. “In Russia, everything is somehow masculine.”
This is how the former president of the Romanian Dacia discovered the charm of Togliatti, a city reminiscent of Soviet times with a population of 700 thousand people, streets wide as runways and rows of houses gray as prisons. This is not to mention the temperature, which drops to -25°C. Invigorating! Business in Russia is a struggle. Especially when it comes to putting such a national giant as AvtoVAZ, the manufacturer of the popular Lada brand of cars, on its feet.
Since Renault-Nissan joined the board of directors in 2008, the alliance has invested more than a billion euros in the company. In just eight years, its sales fell from 640 thousand to 269 thousand. In 2015, losses exceeded 900 million euros, and in the first nine months of 2016 they amounted to 498 million. However, there is no question of giving up. Under gentle pressure from Moscow, Renault (already without Nissan) even began the process of recapitalizing AvtoVAZ, as a result of which the company would own 70% of the enterprise's capital. And it will turn into a real “daughter”. “Renault is looking to consolidate unprofitable production, which will affect operating profits,” warns London-based Jefferies analyst Philippe Houchois.
How could the strategist Carlos Ghosn have missed so much? In his defense, it is worth saying that during the era of the merger with AvtoVAZ, the prospects were simply brilliant. “Russia was becoming the largest car market in Europe, surpassing even Germany,” says Emmanuel Quidet of Ernst & Young.
In Russia, the number of cars is 350 per thousand inhabitants versus 650 in Western Europe. More than 50% of the total vehicle fleet (40 million) is more than ten years old. Ancient Zhiguli cars are still driving along snow-covered roads, that is, the first Ladas, which were produced from the 1970s to the end of the 1980s based on the Fiat 124...
Alas, conquering the market did not go as planned. First of all, the shock wave of the mortgage crisis did not spare the Russian economy. The collapse in oil prices, the devaluation of the ruble and Western sanctions after the annexation of Crimea further aggravated the situation. The automotive industry has been one of the main victims, with an almost 45% decline in sales since 2012 (from 2.7 to 1.5 million). Foreign manufacturers who set up production in the country had to deal with the consequences. So, Opel decided to pack their bags.
Ford, Toyota and PSA have lowered their sails in anticipation of better times. Renault-Nissan has in fact become the market leader with AvtoVAZ, whose giant plant in Tolyatti produces Renault (renamed Dacia), Nissan and Datsun. Therefore, it is very difficult to reverse here.
Be that as it may, the failures of the alliance were not due solely to the crisis. Local business culture also played a role. Take enterprise management, for example. “At AvtoVAZ there is a strange system of co-chairmanship. You always wonder how much of Renault-Nissan really owns it, since its hands are so tied,” says Eric Faron, a consultant who understands the Russian market.
Context
Renault: restore order in Russia
The Wall Street Journal 04/13/2016Renault-Nissan is being forcefully dragged into AvtoVAZ
Liberation 03.11.2010Lada wants to produce beautiful cars
Die Welt 09/07/2016The alliance will increase its share in the Russian market
Toyo Keizai 12/24/2014 So who really makes the decisions? In April last year, as a result of strange reshuffles, Carlos Ghosn gave up the chair of the chairman of the board of directors to Sergei Skvortsov, general director of the Rostec state corporation (AvtoVAZ shareholder). Other figures close to power, such as Eduard Vaino, who is responsible for relations with the government, also sit on the council. His son Anton Vaino was recently appointed chief of staff of President Vladimir Putin. That is, Moscow is closely monitoring the progress of the meetings.In such conditions, solving serious problems is not at all easy. Nicolas Mora's predecessor, Swede Bo Andersson, the first foreigner at the head of AvtoVAZ, was convinced of this from his own experience. From 2013 to 2016, he halved his vastly overstaffed workforce and hammered home the need to renegotiate sometimes suspect contracts with a number of local manufacturers. As a result, everyone, from the chairman of the factory trade union (38 thousand members!) Sergei Zaitsev, to the head of Rostec Sergei Chemezov and the mayor of Togliatti Sergei Andreev, began to demand his head. And last year she flew. Apparently, the alliance was presented with a fait accompli.
Thus, Nicolas More faces a difficult task. To be convinced of this, it is enough to enter the territory of the plant (600 hectares), over which the blue administrative building hangs. At the checkpoint, guards closely monitor those coming and going. People in blue jackets with impassive faces walk around the cars, check the documents of passengers, look under the seats, look into the trunk and almost under the hood. “They need to make sure that no one takes away the spare parts,” explains the plant representative apologetically...
Is theft a common problem here? In any case, the scale is impressive. Smelting, foundry, engine and transmission production... With the exception of tires, almost everything is made on site. This is an absurdity in the current era of intense specialization. And there is hardly any need to explain that today the mechanism is working at a slow pace. The plant's capacity to produce a million cars is at 45% capacity. In the current circumstances, assembly lines, by management's decision, are only open four days out of five. The only exception was the most modern B0, which the alliance installed in 2012 for 400 million euros.
Only the already low salaries (430 euros on average, 290 euros for workers - the main factor of competitiveness) decreased by 20%. AvtoVAZ invites employees to participate in public works, which are paid for by the government. “We've recently repainted the city's churches,” says Nicolas More.
To support the plant, he also transferred the production of Dacia bodies to Togliatti for assembly at the plant in Oran, Algeria, which until recently were produced in Romania. Another important task is compliance with Western production standards. Although this will not be achieved quickly. In terms of productivity, the Tolyatti plant is 25% behind Dacia's production in Pitesti, Romania.
Even modernized workshops do not show the best results. The Sandero, Logan and Nissan Almera engine plant, which also assembles gearboxes, uses the Japanese “kaizen” (continuous improvement method). At the entrance, Alexander Egorov shows a table with graphs and diagrams: comparative indicators of a dozen factories from around the world on such parameters as productivity, quality, production time, etc. All this, of course, is interesting, but the local enterprise is trailing behind by almost all criteria...
It is worth saying that AvtoVAZ has come a long way. There was a time when a Lada buyer could lift the hood and discover that there were a couple of spare parts missing. With the arrival of Renault, the quality has improved, although you still shouldn’t let your guard down. On the walls of the B0 assembly shop, where Ladas, Dacias and Nissans are produced, there are pictures showing what needs to be avoided. In one photo, employees are working with rings on their hands, thereby risking scratching the coating. On another, the belt buckle becomes a source of threat. “At every crew shift, we set aside five minutes to remind the instructions,” explains the foreman.
All that remains is to restore the brand image. Buyers often prefer foreign cars (especially Korean ones) to Ladams, despite their low price (from 5 thousand 500 to 12 thousand euros). “We are going to raise the status of the product somewhat, while maintaining affordability, durability and ease of repair,” says Nicolas More. His dreams even go as far as resuming exports. Not only to former fraternal countries, but also to Africa, the Middle East and even Western Europe. “We are thinking about a successor to the LADA 4x4, which would have better cross-country ability and be competitive in terms of safety and environmental friendliness,” he says. It will be very difficult to achieve everything...
InoSMI materials contain assessments exclusively of foreign media and do not reflect the position of the InoSMI editorial staff.
