Avtotor, China's SNAT agree to localize production of auto components

KALININGRAD. May 26 (Interfax) - Avtotor and Shanghai Nuoang Automobile Technology Co. Ltd (SNAT), a Chinese developer of electric vehicles, electric motors and components for them, have signed a cooperation agreement on localizing production of auto components in Russia, the Russian automaker reported.

The companies agreed to cooperate on a project to set up production in Kaliningrad of electric vehicles, natural gas vehicles, automobiles with hybrid engines and parts and components for them, including electric motors, gear systems, electronic control systems and printed circuit boards, Avtotor, which is based in the Russian Baltic exclave, said.

The company plan to work out a joint plan for the localization program, which will be carried out in stages. Production will be aimed at supplying Avtotor as well as other Russian automakers.

The first phase of facilities, for machining and electric engine assembly, is scheduled to be launched before the end of 2023. The second phase, including the launch of equipment to make castings, will be brought on line in 2024, the company said.

The signed agreement also calls for the companies to work together "to attract technology partners for the organization of auto component production in Russia aimed at maximum involvement of local manufacturers in the production chains of Avtotor and other Russian automakers in future," Avtotor Holding LLC president Denis Pak was quoted as saying in the press release.

The company recalled that production of electric vehicles and auto components is one of Avtotor's obligations under a ten-year special investment contract (SPIC) with Russia's Industry and Trade Ministry and the government of Kaliningrad Region.

It was reported earlier that, under the SPIC, Avtotor is carrying out a project to build several plants for production of electric vehicles. Overall investment in implementing the announced plans, including current investment obligations, will total at least 32 billion rubles.

Avtotor is working on producing a pilot batch of 200 electric vehicles in 2023. These will be budget vehicles, with prices starting at 500,000 rubles.

Avtotor has been producing automobiles since 1997. It assembled BMW, Kia and Hyundai cars until 2022, but assembly of the German vehicles was shut down in the spring of 2022 and production of the South Korean vehicles stopped in early October.

Avtotor now assembles the automobiles of Chinese brands Kaiyi, BAIC and SWM.