About Company

History

CJSC GM-AVTOVAZ started its existence from the 27th of June in 2001 when the general framework agreement was signed by representatives of General Motors, AVTOVAZ and European Bank for Reconstruction and Development. Joint Venture was set up at the foundation meeting on the 30th of July in 2001 and was registered in Russian Ministry of Justice on the 2nd of August in 2001.

First employees were recruited on the 27th of August in 2001 and the excavation works at the site started in October.

The shareholders contributed capital is $238.2 million:

  • General Motors – $99.1 million by cash and equipment, 41,61%;
  • AVTOVAZ – $99.1 million by intellectual property (patents and trade mark on Niva 2121), buildings, etc., 41,61%;
  • European Bank for Reconstruction and Development (EBRD) – $40 million in cash, 16,78%, and loan facility for $100 million

Investment

The total amount of investment into the project scheduled for $338.2 million. It includes:

  • 82.3 million – cash,
  • 63.6 million – intellectual property,
  • 92.3 million – equipment,
  • 100 million – EBRD loan

Production

The total area of the Joint Venture is 137 564 square meters . It includes:

  • B-in-W Assembly;
  • Finish Body Shop (major dyes and frame body lines outsourced to AVTOVAZ);
  • Paint Shop (inaugurated on the 2nd of April in 2003);
  • General Assembly and Auxiliary Workshops;
  • Dispatch area with vehicles pre delivery operations;
  • Administrative Building

Two general contractors were involved in the construction and equipment layout planning activities:

  • QuattroGemini Ltd. ( Finland ) with Russian experience over 7 years was responsible for construction of the JV buildings and connection of all needed infrastructure
  • Eisenmann ( Germany ) covered the process engineering part of the project and constructed the total new Paint Shop.

The project management and engineering support was performed by the American company Hanscomb with broad expertise on project management all over the world. Hanscomb has been operating for 10 years at the Russian market.

More than 30 companies and about 1000 people from Togliatti were involved in the construction activities.

On September the 23rd, 2002 the first Chevrolet NIVA drove off the assembly line of the plant. It was acknowledged by auto journalists as a very comfortable, reliable and safe car. The entrance of the Company to the Russian market was immediately acknowledged by Grand-Prix of “Za Rulem Magazine” under category “Breakthrough of the Year”. Since then Chevrolet NIVA has been in good demand by customers. The market was introduced to a state-of-the-art, good-quality competitive SUV product.

In September 2004 on the same production line was launched a new front-wheel-drive “C”-class Chevrolet VIVA, based on Opel Astra T-3000 that was acknowledged as one of the best European cars of the time.

In early 2006, the Company built pilot Chevrolet NIVA GLX with FAM1 1.8 engine, new transmission, ABS, A/C and air bags. Following the results of safety tests according to EuroNCAP this car was given four stars.

In March 2009 the Company launched a facelifted version of the Chevrolet NIVA. Over 60 engineering changes have been implemented to improve quality of the Chevrolet NIVA.

In May 2010, the Company started production of improved Chevrolet NIVA equipped with drive shafts with constant velocity joints instead propeller shafts and transfer box with dual race bearings for output shafts. Changes introduced allowed not just significantly reducing noise and vibration, but also improving quality, durability and comfort of Chevrolet NIVA.

Effective  August 1st of  2011, GM-AVTOVAZ  launched production of Chevrolet NIVA equipped with ABS (anti-locking brake system) produced by Bosch and airbags produced by TRW for GLS and  GLC versions. ICV (in-country validation) tests have been carried out successfully in Russia, Sweden, Germany and Spain.

On July 31, 2012, GM-AVTOVAZ started production of Chevrolet NIVA Limited Edition (LE).

The major differences between Chevrolet NIVA LC specification and Chevrolet NIVA LE are:

  • Snorkel for water obstacles overcoming;
  • GLC standard roof railings;
  • Off-road tires Continental Conti Cross Contact AT 215/65 R16;
  • Light-alloy wheels "Kamelot" Black 7Jx16H2;
  • Front winch bracket;
  • Powertrain and front axle reduction protection;
  • Trailer winch with rear bumper protection and bracket for rear winch;
  • Exterior antenna with cable.

EBRD Exits from Shareholding

On September 21, 2012, the Board of Directors approved the agreement providing that CJSC GM-AVTOVAZ will purchase the EBRD’s shares, and then cancel them.  Accordingly, the share packages owned, respectively, by General Motors (via GM Auslandsprojekte GmbH) and JSC AVTOVAZ will remain the same, leaving both with a shareholding of 50%.  The transaction was completed by the end of September, 2012.

Construction of production facilities of JV Systems LLC subsidiary on the territory of the SEZ in Togliatti

On June 14th, CJSC "GM-AVTOVAZ" announced the start of construction of new production facilities for wholly-owned subsidiary JV Systems LLC on the territory of the Special Economic Zone in Togliatti, Russia.

On November 16th, 2012, the JV System’s business plan was approved by the Expert Council on Industrial Production for Special Economic Zones at the RF Ministry of Economic Development.

The total investment into the project is planned to reach $209 mln. Total area is 200,000 m2. Designed capacity for the new production facilities is 120,000 bodies per annum, with production concentrating on the next generation of Chevrolet NIVA. Production facilities include: press and body shops, logistics center and production support facilities.

For design and construction of the new facilities, GM-AVTOVAZ has chosen JSC “Avtozavodstroy” (Togliatti) as general contractor.

The overall manufacturing layout and processes for the new facilities are being developed with involvement of and support from General Motors International Operations, which encompasses over 60 operations in 30 countries that have implemented GM manufacturing standards and systems.

Construction of production facilities for JV Systems LLC will start on June 14th, 2013. Launch of Chevrolet NIVA New Generation is slated on December 2015.

Over 1,000 new jobs will be created by the new operations.

Today, JV Systems LLC is the largest project within the SEZ in Samara region.

Production and Sales

In 2002, 456 cars rolled off the JV’s production line, in 2003 – 25,235, in 2004 – 55,150, in 2005 – 51,810, in 2006 – 47,881, in 2007 – 55,052, in 2008 – 54,654, in 2009 – 23,101, in 2010 – 36,996, in 2011 – 57,765, in 2012 – 62,981, in 2013 – 57,939 Chevrolet NIVA cars.

Totally, since the start of production (September 23, 2002), 525,829 Chevrolet NIVA cars were sold including 38,345 units to CIS countries (dated on January 01, 2014).

161 dealers provide Chevrolet NIVA sales in Russian Federation together with 7 dealers and 3 distributors in CIS countries.

According to the Association of European Businesses in Russia, by the results of 2004-2008, the Chevrolet NIVA became the best-selling SUV in the Russian market. In 2006, it received the prize “The SUV of the Year – 2006” in the class “Compact SUV“, and based on the results of the vote “Grand Jury“ of the award “The SUV of the Year – 2009”, the Chevrolet NIVA was awarded in the categories “SUV” and “Premiere of the Year”.

In addition, based on sales results of 2012, the SUV Chevrolet NIVA became the best-selling in Russia in SUV segment.

 

Personnel

One of the main tasks of GM-AVTOVAZ is to provide the Company with qualified cadre. In this order cooperation with recruiting agencies of Togliatti and other regions, which help to assess and select employees, is realizing. As the position opens, the information about requirements to candidate is accessible to all in order for interested JV employees to take part in the selection. Final decision of choice of a candidate is accepted after the interview of potential candidate with Department Manager and HR representative.

As for personnel training, in 2010 “Simulated working environment” was started at GM-AVTOVAZ aimed at training and adaptation of newcomers and additional introduction of the current personnel with production organization. SWE is training environment, imitating the work of GM-AVTOVAZ production line, where employees learn about standardized work and “built-in-quality” rules. Also SWE directs employees to train teamwork skills, meet targets and values of the Company in the environment, maximum close to reality.

The Company actively develops personnel, educates and re-educates employees. The main direction of annual trainings organization is strategy oriented on the Company needs. For example, in 2010 the JV Management and key specialists passed “Conflict management” training.

The Company continues involvement in education its internal recourses – specialists, who has become experts in their fields.

On the 1st of January 2013 the total number of employees of the Company amounted to about 1600 people.

Innovations

The Joint Venture production philosophy is based on lean production concept (GM-GMS system) which is standard for any GM Corporation facility throughout the world. The main element of this concept is how to reduce wastes of all kinds and ensure manufacturing of quality products which is achieved through strict input and output control as well as standardized procedures, personnel training and motivation. From the 1st of July in 2002 the SAP system was introduced at the plant and it is successfully operational ever since. Currently it is being upgraded and developed.

Policy in the Field of Environmental

«GM-AVTOVAZ» being the manufacturer of the automobiles, realizes the responsibility for Environmental protection and takes up obligations:

  • To prevent Environmental contamination;
  • To carry out activity according to applicable legal requirements and requirements of GM-AVTOVAZ Environmental Management System, corporate requirements of General Motors and other requirements related to its environmental aspects;
  • Constantly improve Environmental Management System;
  • To use natural resources rationally;
  • To demand from all personnel of the company to perform works according to working rules and norms of protection of the Environment;
  • To train the personnel with the purpose of a level increasing of its ecological consciousness and understanding of the personal responsibility for the Environmental conditions;
  • To organize works by a principle: it is easier to foresee and prevent pollution than to eliminate its consequences;
  • To plan, supervise and improve ecological parameters of the activity with the purpose of decreasing the influence to the Environment.

GM-AVTOVAZ Policy in the field of environmental

Key Goals of the Joint Venture

  • to become a major player in Russia and CIS regional vehicle markets by producing cars of competitive quality and of affordable prices
  • introduction of the quality culture,
  • implementation of low-cost production and procurement systems,
  • strengthening of Western companies confidence in Russian business,
  • attraction of investments into Russian automotive industry stimulating setting up the Joint Venture in auto components industry.

To carry out activity according to applicable legal requirements and requirements of GM-AVTOVAZ Environmental Management System, corporate requirements of General Motors and other requirements related to its environmental aspects.

Go up