AvtoVAZ has announced that it has more than doubled production of its new flagship Vesta passenger car to 230 units a day after a relatively slow ramp-up to production, according to a Skrin newswire report. In January and February, the company was producing around 100 units a day of the new model at its facility in Izhevsk, Russia, and a spokesperson confirmed that production was now being substantially ramped up, although no precise number was given, with the 230-units-a-day figure being given out by sources working at the plant. The plant is now working five days a week in two shifts, which is a full day more than at the company's main Togliatti plant, which has reduced its output in response to the weakness of the Russian passenger car market.
Significance: AvtoVAZ and its Lada brand has been somewhat unlucky in its biggest model range revamp in more than a decade, and its first under the ownership of the Renault-Nissan alliance, coinciding with the biggest and most prolonged slump in the Russian passenger-car market since the end of the Communist era. The Russian passenger-car market fell by 36% year on year (y/y) in 2015 and in the first two months there was a further contraction in the light-vehicle market of 20.8% y/y. In view of the current moribund state of the Russian market, it made sense to engage in a slow production ramp-up in the Vesta's production to ensure initial production quality and to prevent inventory build-up. The company will bring out the new X-Ray crossover later this year, in addition to the range-topping Vesta passenger car. However, there appears to be little prospect of a recovery in the Russian market until 2017, according to IHS Automotive's latest forecast.
