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Paul-Holmes
Lounge Wizard
Joined: 12 Apr 2005
Posts: 1073
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 Posted: Sun Dec 09, 2007 3:56 am Post subject: Lada and Renault alliance |
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Renault buys quarter of Russian Lada maker AvtoVAZ
MARCEL MICHELSON AND GLEB BRYANSKI
Reuters
December 8, 2007 at 1:26 PM EST
PARIS and MOSCOW — French car maker Renault agreed to buy a quarter of Russia's biggest auto maker, AvtoVAZ , aiming to revive the faded Lada brand and strengthen its hold on what will soon be Europe's largest car market.
Renault Chief Financial Officer Thierry Moulonguet told a conference call on Saturday that the Russian market, on course to overtake Germany's in a few years, was seen at 3.5 million to 4 million cars by 2015 against 2.3 million in 2007.
Mr. Moulonguet declined to reveal a price but said the market value of AvtoVAZ was $5.7-billion and that Renault was paying a ‘reasonable multiple' over earnings for its 25 per cent stake.
“They gave us a fair price, close to the market price,” said Sergei Chemezov, the head of AvtoVAZ owner, state-controlled Russian Technologies, previously known as Rosoboronexport.
Mr. Chemezov said Renault had fought off competition from U.S. General Motors, Italy's Fiat, Canada's Magna International and Germany's Volkswagen AG.
Renault and AvtoVAZ plan to make a car costing about $15,000 to tap into Russia's booming car market and will boost total car production to 1.5 million units per year, Mr. Chemezov said.
AvtoVAZ's Lada brand would be kept, said Renault CEO Carlos Ghosn: “The development of the Lada brand will be a priority.”
Mr. Chemezov said Russian Technologies would later sell part of its own stake in AvtoVAZ at an initial public offering but retain a blocking stake, which means more than 25 per cent. Mr. Chemezov said Russian Technologies would also sell stakes to two Russian steel tycoons, Alexei Mordashov and Alexei Usmanov.
Mr. Moulonguet said Renault would not raise its stake from 25 per cent but had a veto over any other industrial partners.
Mr. Ghosn and Mr. Chemezov signed a memorandum of understanding in a ceremony on Saturday transmitted by telephone from the central Russian city of Togliatti, 1,000 km east of Moscow where AvtoVAZ has its main plant with 105,000 employees.
Mr. Ghosn said Renault would help the company to increase production and exports. By boosting capacity at Togliatti, the cost per car would fall. The plant would eventually also make cars for Renault and associated Japanese group Nissan.
Once the capital of AvtoVAZ has been restructured in the first half of 2008, a holding company equally owned by Russian Technologies and Renault would control a total of 50 per cent of the shares of AvtoVAZ.
The partnership will include co-operation on engines and gearboxes for AvtoVAZ and Renault vehicles. Renault will provide car platforms and powertrains to help renew the Lada product line, which has suffered falling sales.
Renault said Russia would become the group's main market.
The sales volumes of Lada vehicles, in agreement with AvtoVAZ and its shareholders, will be consolidated by Renault.
Mr. Moulonguet said the deal's impact on 2008 results would be neutral and Renault stuck to its 2009 operating profit margin goal of 6 per cent as the impact would be mainly in later years.
Renault and Nissan are already active in Russia and the three brands combined would have a 40 per cent market share.
Arms trader Rosoboronexport secured control of the company in 2005 but has failed to achieve a turnaround.
Rosoboronexport's fast growth in recent years, to become a leading industrial group, is seen by analysts as a sign of the Kremlin's rising sway in the economy – Mr. Chemezov is a personal friend of President Vladimir Putin.
Revenues at AvtoVAZ fell by 2.1 per cent in the first nine months of the year, with unit sales falling by 1.8 per cent to 472,000 vehicles. AvtoVAZ already produces the Chevy Niva budget sport utility vehicle in a joint venture with GM. |
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vox16
Just Starting
Joined: 14 Apr 2010
Posts: 5
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| Posted: Sun Dec 09, 2007 11:51 am Post subject: Re: Lada and Renault alliance |
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| Their new cars will still break down like ladas, but the process of repair will be as painful and expensive as their new investor's ones. |
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mister_wizzz
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Joined: 27 May 2004
Posts: 582
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| Posted: Sun Dec 09, 2007 3:33 pm Post subject: Re: Lada and Renault alliance |
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| vox16 wrote: | | Their new cars will still break down like ladas, but the process of repair will be as painful and expensive as their new investor's ones. |
Don't underestimate Renault. It is a big car manufacturer and have advanced technology (just check the success of Renault in Formula 1 and rally races). Lada will get a big benefit in this association, that's for sure.
Let's wish them success, it is in the Russians interest. |
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vox16
Just Starting
Joined: 14 Apr 2010
Posts: 5
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| Posted: Sun Dec 09, 2007 5:56 pm Post subject: Re: Lada and Renault alliance |
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| mister_wizzz wrote: |
Don't underestimate Renault. It is a big car manufacturer and have advanced technology (just check the success of Renault in Formula 1 and rally races). Lada will get a big benefit in this association, that's for sure.
Let's wish them success, it is in the Russians interest. |
What about manufacturer using M7 bolts? Or centering engine head in one and only one point? Or a totally rotten wiring ( in Moscow road salt ) after the very first winter on a renaut lorry? |
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mister_wizzz
VIP
Joined: 27 May 2004
Posts: 582
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| Posted: Sun Dec 09, 2007 9:51 pm Post subject: Re: Lada and Renault alliance |
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| vox16 wrote: | | mister_wizzz wrote: |
Don't underestimate Renault. It is a big car manufacturer and have advanced technology (just check the success of Renault in Formula 1 and rally races). Lada will get a big benefit in this association, that's for sure.
Let's wish them success, it is in the Russians interest. |
What about manufacturer using M7 bolts? Or centering engine head in one and only one point? Or a totally rotten wiring ( in Moscow road salt ) after the very first winter on a renaut lorry? |
Well I am not a car mechanic specialist. The only thing I can say is that we have also winter here (not so tough) and our roads are frequentely salted, I have never seen rusted points on any car (french or not).
I used to have a Renault and lived 2 years on the sea cost (in that case we have salt all the year long) and never had a problem.
I also spent 5 months in the Renault Vehicule Industriels labs (it is the old name, now it is called Renault trucks since Renault sold truck activity to Volvo) when I was a student and saw how serious engeeners and technicians are, Renault trucks (like others Europeean truck manufacturers) are very reliable. |
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yorbcbud
Lounge Wizard
Joined: 17 Feb 2006
Posts: 4903
Location: Сорренто, Британская Колумбия, Канада
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| Posted: Tue Dec 11, 2007 5:46 am Post subject: Re: Lada and Renault alliance |
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| mister_wizzz wrote: | | vox16 wrote: | | mister_wizzz wrote: |
Don't underestimate Renault. It is a big car manufacturer and have advanced technology (just check the success of Renault in Formula 1 and rally races). Lada will get a big benefit in this association, that's for sure.
Let's wish them success, it is in the Russians interest. |
What about manufacturer using M7 bolts? Or centering engine head in one and only one point? Or a totally rotten wiring ( in Moscow road salt ) after the very first winter on a renaut lorry? |
Well I am not a car mechanic specialist. The only thing I can say is that we have also winter here (not so tough) and our roads are frequentely salted, I have never seen rusted points on any car (french or not).
I used to have a Renault and lived 2 years on the sea cost (in that case we have salt all the year long) and never had a problem.
I also spent 5 months in the Renault Vehicule Industriels labs (it is the old name, now it is called Renault trucks since Renault sold truck activity to Volvo) when I was a student and saw how serious engeeners and technicians are, Renault trucks (like others Europeean truck manufacturers) are very reliable. |
I am a licensed mechanic. I have personally owned a half dozen Renaults. They are not good cars. Too fragile for the North American market. I bet the trucks are better. I have heard that Ladas are bad, but I can't verify it. |
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MrSpice
Lounge Wizard
Joined: 14 Jul 2003
Posts: 3431
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| Posted: Tue Dec 11, 2007 8:26 am Post subject: Re: Lada and Renault alliance |
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| yorbcbud wrote: |
I am a licensed mechanic. I have personally owned a half dozen Renaults. They are not good cars. Too fragile for the North American market. I bet the trucks are better. I have heard that Ladas are bad, but I can't verify it. |
He owned a half dozen Renaults, but not a single home... In fact, yorbcbbud lives in a Renault bus. |
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RusskiCanadian23
Lounge Wizard
Joined: 27 Mar 2007
Posts: 1104
Location: Vancouver, British Columbia, Canada/Ванкувер, Британская Колумбия, Канада
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| Posted: Tue Dec 11, 2007 8:36 am Post subject: Re: Lada and Renault alliance |
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| MrSpice wrote: | | yorbcbud wrote: |
I am a licensed mechanic. I have personally owned a half dozen Renaults. They are not good cars. Too fragile for the North American market. I bet the trucks are better. I have heard that Ladas are bad, but I can't verify it. |
He owned a half dozen Renaults, but not a single home... In fact, yorbcbbud lives in a Renault bus. |
Kind of like this one?
Looks pretty nice. I bet you couldn't even afford this one, Spice.  |
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yorbcbud
Lounge Wizard
Joined: 17 Feb 2006
Posts: 4903
Location: Сорренто, Британская Колумбия, Канада
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| Posted: Tue Dec 11, 2007 9:00 am Post subject: |
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Actually, it's somewhat larger. 40 ft to be exact.
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surfguy
Lounge Wizard
Joined: 13 Apr 2006
Posts: 6979
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| Posted: Tue Dec 11, 2007 11:12 am Post subject: |
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Does it run? And what year is it? Hmmm...just hope there isn't a puddle of oil under it or coolant...that would be bad for the environment up there and if it leeches into the pond then the fish will die...and if the fish die what will the bears eat or the eagles and then the whole eco system will collapse and all because BC decided to park his dam bus on some pristine land.  |
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surfguy
Lounge Wizard
Joined: 13 Apr 2006
Posts: 6979
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| Posted: Tue Dec 11, 2007 11:13 am Post subject: |
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| Renaults have a very bad reputation here in the USA |
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yorbcbud
Lounge Wizard
Joined: 17 Feb 2006
Posts: 4903
Location: Сорренто, Британская Колумбия, Канада
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| Posted: Tue Dec 11, 2007 11:20 am Post subject: |
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| surfguy wrote: | | Does it run? |
Yes it does, quite well, in fact | Quote: | | And what year is it? |
It's a 1979 International | Quote: | | Hmmm...just hope there isn't a puddle of oil under it or coolant...that would be bad for the environment up there |
No, it doesn't leak anything | Quote: | | and if it leeches into the pond then the fish will die...and if the fish die what will the bears eat or the eagles and then the whole eco system will collapse and all because BC decided to park his dam bus on some pristine land. |
 I think something may have collapsed in San Diego |
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yorbcbud
Lounge Wizard
Joined: 17 Feb 2006
Posts: 4903
Location: Сорренто, Британская Колумбия, Канада
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| Posted: Tue Dec 11, 2007 11:29 am Post subject: |
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| Goodnight Surfguy. You are obviously still drunk from your last binge. Try to get some rest, buddy. |
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surfguy
Lounge Wizard
Joined: 13 Apr 2006
Posts: 6979
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| Posted: Tue Dec 11, 2007 12:33 pm Post subject: |
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| Well internationals are pretty heavy duty...and it looks like you maintain it quite well |
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surfguy
Lounge Wizard
Joined: 13 Apr 2006
Posts: 6979
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| Posted: Tue Dec 11, 2007 12:35 pm Post subject: |
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| I actually think it's pretty cool...and you live surrounded by nature...what could be better |
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