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DATE News (chronologically)
11/07/08
automotive
GM opens $300 million Russian plant to offset U.S. auto slump
General Motors Corp. opened a $300 million factory in Russia as it looks to compensate for slumping sales in western Europe and North America, Bloomberg News reported today.

Located on the outskirts of St. Petersburg, the plant will produce 70,000 Chevrolet Captiva sport-utility vehicles and the Opel Astra, with plans to manufacture the Chevrolet Cruze compact car next year, the Detroit automaker said.

"Our strategy is to become the leading manufacturer in Russia," Carl-Peter Forster, GM's chief for Europe, told reporters during the plant opening today. "For us Russia is not an emerging market. Russia emerged long ago."

Russia will become GM's biggest car market in 2009, Forster said. GM boosted its market share in Russia this year to 10.9 percent from 6.5 percent in 2006. The Chevrolet Lacetti is Russia's second best-selling foreign-brand car after Ford's Focus.

GM follows five other foreign automakers with plants near St. Petersburg. Toyota Motor Corp., the world's second-largest automaker, and Ford operate assembly factories near Russia's second-biggest city. Nissan Motor Co., Hyundai Motor Co. and Suzuki Motor Corp. are building facilities in the area.

Russia surpassed Germany as Europe's biggest car market in the first half as sales rose 41 percent, according to PricewaterhouseCoopers LLP.

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