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Renault-Nissan chief sees growth in Russian car market
July 16, 2013 / 9:01 AM / 4 years ago

Renault-Nissan chief sees growth in Russian car market

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Carlos Ghosn, Chairman and CEO of the Renault-Nissan Alliance, attends a visit to the Renault automobile factory in Flins, west of Paris, May 28, 2013.Benoit Tessier

MOSCOW (Reuters) - Renault-Nissan boss Carlos Ghosn expects Russia's car market to overcome recent weakness and is aiming, with the help of Lada-maker AvtoVAZ (AVAZ.MM), to capture 40 percent of the market, he said in a newspaper interview.

According to figures from the Association of European Business (AEB), which tracks the Russian car market, car sales have fallen for four straight months as Russia's $2 trillion economy has faltered. The AEB recently cut its full-year forecast to a fall of 5 percent.

Ghosn, however, said he was optimistic the market would grow over the longer term, citing low car ownership in the country.

"I don't doubt for a second that car ownership in Russia should be not less than in Portugal, Spain and Italy," he told Vedomosti.

"There may be quarterly or even yearly falls in sales, but on the whole I have no doubt that the trend is upward."

Car ownership in Russia is less than 300 per 1,000 people, compared with a European average of 500, he said.

Ghosn is chief executive of Japan's Nissan Motor Co (7201.T) and holds the same position at its partner, French carmaker Renault SA (RENA.PA).

Last year, Renault-Nissan finalized a deal to take control of AvtoVAZ by mid-2014, deepening a four-year partnership it had with the Russian carmaker in a bid to tap demand for new cars from Russians with growing incomes and rising aspirations.

Ghosn did not give a sales forecast for Russia but said he intends Renault, Nissan and AvtoVAZ to take 40 percent of the market, up from 32 percent this year. He has previously said he wanted the venture to capture 40 percent of sales by 2016.

Globally, he repeated a previous forecast that the worldwide automotive industry should sell a record number of cars in 2013 - more than 81 million vehicles. He has previously said this would be an increase of three percent over the last fiscal year.

Asked about Renault's plans to manufacture cars and vans in Russia with truckmaker ZIL (ZILL.RTS), he said that talks were at an early stage and he could say nothing more specific.

In March, French carmaker PSA Peugeot Citroen (PEUP.PA) said it was in talks on sharing vehicle production with ZIL, confirming a report in Vedomosti which also cited a source at a ZIL affiliate in Moscow saying ZIL was hoping to sign contracts with several companies.

Reporting by Megan Davies; Editing by Alessandra Prentice and Mark Potter

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