September 24, 2002

First car rolls off the line at joint GM-AutoVAZ plant in Russia

Togliatti, Russia – The first Chevrolet Niva rolled off the assembly line yesterday to mark the start of production at the new GM-AvtoVAZ joint venture plant in Togliatti, Russia.

General Motors Chairman John F. Smith Jr. attended the opening ceremony along with senior Russian government officials. The ceremony took place in the new production plant.

Built in a state-of-the-art plant, the Chevrolet Niva four-wheel-drive compact sport utility vehicle is expected to sell for around $8,000 US, placing it in the largest price segment of the Russian market.

“The fact that just 15 months ago we signed this agreement and today we stand here in this brand-new facility to mark the start of production of an all-new vehicle, demonstrates the incredible dedication and commitment of all who have been involved in this project,” Smith said. “This project reflects the importance we place on being in the Russian market – utilizing local expertise and resources to tap the vast potential of this important growth market”

For the first full year of production, the GM-AvtoVAZ JV plans to produce 35,000 Chevrolet Nivas. By 2005, production is expected to reach 75,000 units. The Niva will be sold in Russia beginning later this year, with exports to Europe, the Middle East, Asia and Latin America planned to begin in October 2003.

By the end of 2002, the plant in Togliatti will employ about 400 people. At full capacity, employment would reach 1,200 people with an estimated 600 more in contracted services. In addition, about 2,000 new jobs will be created at supplier plants.

The GM-AvtoVaz Joint Venture is a partnership between GM, AvtoVaz and the European Bank of Reconstruction and Development (EBRD). With a total investment of U.S.$332 million, it represents one of the largest foreign investments in the automotive industry in Russia. Under the terms of the agreement, GM and AvtoVAZ each hold a 41.5 percent stake in the joint venture and the EBRD holds the remaining 17 percent share.

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