China's state-owned Chery Automobile Co. will assemble its cars in Russia under an agreement with the Avtotor automaker, the Kommersant business daily reported Tuesday. The paper said Chery vehicles initially would be produced on spare capacity at Avtotor's assembly plant in the Kaliningrad exclave, where the company already assembles BMW, Kia, Chevrolet, Hummer and Cadillac models.
Separately, the two companies planned to invest up to US$200 million (Ђ166 million) in a plant with capacity of 150,000 cars per year, the paper quoted Valery Sokolov, the chairman of the board of Avtotor-Holding, as saying.
Spokesmen at Avtotor and Chery could not immediately be contacted for comment. Angelina Valavina, automobile analyst at the Renaissance Capital investment bank, said that as domestic producers lose ground to imported vehicles in a market expected to grow by over 5 percent a year up to 2014, the two companies' plans were plausible, reports the AP. I.L.
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