UPDATE 1-Nissan to enter Russia light truck market
By Simon Shuster
MOSCOW, April 17 (Reuters) - Nissan Motor Co (7201.T), Japan's third-largest auto maker, on Thursday announced the introduction of its light commercial vehicles to Russia with the aim of becoming Russia's largest foreign LCV supplier by 2012. The automotive giant will start selling the machines in September and will build a new dealer and service network for its LCVs, which include trucks weighing 3.5-7.5 tonnes.
"Russia is a green field market for our LCVs. We are starting from zero," Stefano Prandi, head of Nissan Russia's light commercial vehicle unit said at a briefing.
The company expects annual sales of 3,500 units for the first two models -- Cabstar brand light duty trucks and NP300 pick-up trucks -- targeting small businesses that need hauling power and middle-class Russians keen on outdoor sports.
These sales should increase to an average of 4,500 units per year as more models are introduced in 2009, Prandi said.
In recent years, foreign carmakers have been streaming into Russia, where demand for foreign models has surged on the back of an oil-fuelled boom in the economy and rising income levels.
Russia is set to become Europe's largest car market in two to three years, with total sales of around $100 billion in 2011, analysts have said.
"Global brands will take share from domestic brands, because the customers will demand greater quality from the product... We want to replicate the success of our passenger cars in the LCV market (in Russia)," Prandi said.
Last year Nissan invested $200 million in a car plant in St. Petersburg that will be able to produce 50,000 passenger cars a year for the internal market after it is launched in 2009.
All of its LCVs, however, will be produced outside of Russia, mainly in Spain and Japan, exposing the LCV venture to Russia's substantial import tariffs.
Nonetheless, Prandi said he expects a full return on investment in three years.
"We will meet all customer expectations in all sectors of LCV," he said, adding that in 2009 they will introduce four more models to this Russian market, making a total of six available.
He declined to give any estimates for how much Nissan would invest in the Russian LCV market. (Additional reporting by Nobuhiro Kubo in Tokyo; editing by Elaine Hardcastle)
