Saving the supply chain
AvtoVAZ, the parent company of Lada, is trying to de production stopped to restart. To this end, the Russian car manufacturer wants to become less dependent on imported parts. It is not clear exactly how AvtoVAZ intends to do this.
–
After the start of the war in Ukraine, Russia had to deal with considerable sanctions packages from the European Union. Among other things, the export of goods to Russia has been restricted, including the supply of parts. This has consequences for the Russian car industry. Lada is at least 20 percent dependent on parts from abroad for its parts supply. Those parts are no longer available, which means that parent company AvtoVAZ has to look for other solutions.
A statement from the company shows that they are working hard to get the supply chain going again. AvtoVAZ is also trying to find replacements for important parts in the cars. AvtoVAZ does not report which parts these are exactly. They also say they are working on ‘special versions of some Lada models’ that require no or fewer imported parts. According to the manufacturer, those cars will gradually come onto the market in the coming months.
Renault, which has had a majority stake in AvtoVAZ since 2016, seems to be struggling with its role in Russia† The French indicate that they are investigating the possibilities with the share in AvtoVAZ. Meanwhile, AvtoVAZ itself says it is “constantly monitoring the situation and in constant contact with the authorities and shareholders.” It is expected that it will take some time before production starts, because the employees will be given an early ‘summer vacation’ from April 4 to 24. AvtoVAZ intends to use that period to restore the supply chain.
—
