China Great Wall Motor to set up assembly plant in Moscow

Dec. 10, 2009 (China Knowledge) - Great Wall Motor Co Ltd<2333> will reportedly set up an assembly plant with an expected annual production capacity of 50,000 sedans in Moscow in 2010.

Great Wall Motor has signed a cooperation agreement with its promoter in Russia to invest about US$5 million to build a modernized factory. Great Wall Motor plans to sell some of the cars made at the plant in Russia but also plans to export cars from Russia to various countries in Europe.

Great Wall Motor’s sales revenue in Russia is low, said the manager of Optim Consult, a consultant company from Russia that deals with Chinese businesses. After the Russian government increased taxes on imported cars, the carmaker decided that the establishment of an assembly plant was the only way to grow in the Russian market.

According to the European Free Trade Association, in the first half year of 2009, Great Wall Motor sold 1,496 cars in Russia, 72% less than in the corresponding period of 2008.