Russia starts work on Renault's low-cost Logan

5th April 2005, Comments 0 comments

MOSCOW, April 5 (AFP) - French car maker Renault on Tuesday launched production of its low-cost Logan model in Russia, hoping to plant a footprint in the promising Russian market where incomes are rising but car owners are scarce.

MOSCOW, April 5 (AFP) - French car maker Renault on Tuesday launched production of its low-cost Logan model in Russia, hoping to plant a footprint in the promising Russian market where incomes are rising but car owners are scarce.

The Logan, first introduced last September in Romania, will retail in Russia at between USD 8,000-12,000 (EUR 6,150-9,230), compared with initial estimates of around USD 6,000, said chairman and chief executive Louis Schweitzer.

Schweitzer told a news conference here that a USD 6,000 (EUR 4, 680). price tag would have required "a degree of local integration and a production pace that were much too high."

At the moment, 80 percent of new passenger cars sold in Russia are priced at less than USD 8,000 (EUR 6,150).

If sales justify it, production capacity for the Logan in Russia could in theory be doubled from its initial 60,000, Schweitzer told a news conference coinciding with the production launch at the Moscow plant of Renault's Russian subsidiary Avtoframos.

The first Logans were scheduled to go on sale in Russia in late summer, bearing the Renault brand. They are being built at the plant of Renault's Russian affiliate, Avtoframos, outside Moscow.

The USD 8,000-12,000 (EUR 6,150-9,230) price segment "will be the core of the Russian market in the years to come," Schweitzer said.

The Avtoframos factory, backed by an investment of EUR 230 million, has the capacity to turn out 60,000 vehicles a year.

"If there is a need, it would be possible - provided we have the necessary authorisations - to double the factory's production capacity," Schweitzer said.

Avtoframos is 76 percent owned by Renault and 24 percent by the Moscow city authorities.

Renault aims to sell more than one million Logans worldwide by 2010. By the end of March more than 45,000 had been registered.

The Logan was developed by Renault and its Romanian subsidiary Dacia and its parent company Renault in a plant near Bucharest. It was initially intended for developing markets, and the opening of the Avtoframos plant marked the first stage in an international rollout.

In addition to Russia, Logan will be produced from 2005 in Morocco and Colombia, to be followed by Iran in 2006 and India in 2007.

The economy car will be marketed in more than 30 countries this year.

© AFP

Subject: French News

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