Sollers agrees to set up LCV production in Azerbaijan

MOSCOW. May 22 (Interfax) - Sollers has reached an agreement to set up production of light commercial vehicles (LCV) at the facilities of Azerbaijan's Azermash, the Russian automaker reported.

Sollers CEO Nikolai Sobolev and Azermash CEO Emin Akhundov signed a memorandum of understanding to this effect on the sidelines of the Russia-Islamic World: KazanForum on Friday.

"The memorandum calls for organizing production of Sollers light commercial vehicles at the facilities of Azermash using components imported from Russia," Sollers said

The companies also agreed to take measures to meet local demand, export automobiles and exchange automobile assembly specialists between Russia and Azerbaijan.

After production of Ford Transit trucks in Yelabuga, Tatarstan was shut down last year, Sollers set up Sollers Alabuga and, using the facilities of its former joint venture with Ford, started implementing a project to produce LCV under its own brand. The company has been making Sollers Atlant vans (2.5-4.2 tonnes) and Sollers Argo cab forward trucks (2.5-3.5 tonnes) based on the models of China's JAC

Sollers deputy CEO and co-owner Zoya Kaika said the new model line is expected to make a "very substantial contribution to [the group's] financial results." The company aims to be annually selling 30,000 LCVs under its own brand in two to three years, and up to 50,000 by 2028, she said.