Russian carmaker GAZ to get $280mn state bail out

By bne IntelliNews June 5, 2015

​Leading Russian automotive company GAZ and the maker of Russia's "other car", the Volga saloon, is to get RUB16bn ($281mn) in state guarantees.

"The state guarantees for GAZ are in the end stage. That is that all the necessary measures … have been taken. The company will receive these guarantees soon," Trade Minister Denis Manturov said at a conference on June 4, reports the Moscow Times.

Russia's car market has been hard hit this year by a combination of a slowing economy and tumbling real incomes, despite the first signs of a bottoming out in the last month. light commercial vehicles (LCV) sales down by 42% in April y/y to 132,000 unites, according to the May 13 release of the Association of European Businesses (AEB) that compiles industry data. In the first four months of this year, a total of 516,000 cars were sold.

April's plunge in sales follows a 36% y/y LCV sales contraction in Q1 and 42% in March alone. In January, AEB believed that car sales for 2015 overall will shrink by 25%.

The government is trying to stop the rot with various subsidies to both producers and on interest rates for car loans to support the sector. 

Related Articles

Russian Gazprombank exits Europe's largest shopping mall

Russian state-controlled Gazprombank sold 30% in Aviapark Mall, one of the largest commercial properties in Europe, Vedomosti daily reported on October 18 citing unnamed sources close to ... more

Russian banks block accounts of SMEs

Russian banks have been actively blocking accounts of small and medium-size enterprises (SMEs) lately as a reaction to the tough banking sector environment, Vedomosti reported on October ... more

Alisa vs Alexa: Yandex launches Russian-language voice assistant

Russian online giant Yandex has launched a voice assistant, "Alisa", available on Android and iOS and, as a beta-version, on Windows, the company said on October 9. Based on neural networks ... more