RUSSIA: GAZ aims for 30% non ex-Soviet Union sales in three years

Russian automaker, GAZ Group says it «must be» selling 30% of its production to non ex-Soviet Union countries in three years as the organisation looks to take advantage of a depreciating rouble.

The manufacturer has a natural constituency in legacy markets and is evaluating Vietnam and Cuba for example, but is keen to demonstrate the international attraction of its commercial vehicles to more traditional countries. 

GAZ has already almost doubled its overseas destinations from 16 in 2013 to 30 last year, although a punitive European customs tax of 22% means EU exports remain problematic. 

 «In three years we must be selling 30% of our output to export markets and by export markets, we mean real export, excluding former Soviet Union countries,» GAZ Group president, Vadim Sorokin told just-auto on the sidelines of the recent Russian Automotive Forum in Moscow. 

Despite Russia's undoubted economic travails at the moment, with high interest rates and inflation coupled with a falling rouble, GAZ cites dealer confidence and its brand power as evidence it has cemented its position in the home market. 

 «We have created a very good system in Russia and few people take heed of that,» he said. «In 2014, we have been rated number one in the dealer satisfaction index in a survey done by EY. 

 «The survey included dealers of over 30 brands - practically all the automotive global players who are present in the Russian market. We were second to Audi in this rating before and now we have been ahead of everybody else for the last two years in a row. 

 «Also, according to research made by international agency, Interbrand, GAZelle was recognised as the most valuable Russian automotive brand. We are the only Russian automotive brand in the rating - we were ranked higher than Aeroflot.» 

The GAZ chief also outlined how tougher engine standards were starting to become the norm in Russia as effects from European legislation started to influence the country. 

 «Currently we have Euro IV standards in Russia and we have Euro V kicking in - we are building Euro V. Really, all these strict emission standards are developed in Europe where there are many densely populated cities. 

 «In Russia, it is a couple of megalopolis like Moscow and St Petersburg, but there are huge distances and vast territories. Sometimes you go 250km along a road without a settlement in sight.» 

In 2014, GAZ obtained unified European vehicle type approval allowing it to sell GAZelle Next vehicles in the European Union. 

Certification tests were carried out both in Russia and abroad while emission tests were performed by AT IDIADA, Spain as there was no equipment for Euro-5 emission tests in Russia at that time. 

The export share of GAZ commercial vehicle sales has grown from 13% to 18% during the last two years with the company attributing the increase to a rise in sales in the CIS, South-Eastern Asia, North Africa and the Middle East.