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Kaluga Region Shares Automotive Industry Development Best Practices at AutoInvest 2016

AutoInvest 2016, the X international conference, is held in  Saint Petersburg on February 24-26, 2016.  This is a venue for elaboration of practical solutions for acute automotive industry development issues   in order to promote the industry’s competitiveness. The strategy for development of the automotive industry and automotive component production till 2025 is being discussed at the conference. The strategy is to be adopted on March 1, 2016. Ilya Veselov, Deputy Minister for Economic Development,  represents Kaluga Region at AutoInvest 2016.

The list of the most acute topics discussed at the conference includes the required government support measures, import substitution opportunities, promotion of localization and Russian products’ export, business and government cooperation.

Ilya Veselov, Deputy Minister for Economic Development of Kaluga Region, speaking at the conference, noted that at the end of 2015 the demand for new vehicles had stabilized, thus, the automotive industry is likely to demonstrate more rapid growth rates.    

Kaluga Region accounts for 11% of the entire Russian vehicle production. The automotive industry companies’ share in the regional  industrial production volume is  33.1 % There are 3 major OEMs in the region, namely Volkswagen Group Rus plant, Peugeot-Citroen and Mitsubishi Motors JV plant, Volvo plant (Volvo Trucks and Renault Trucks), as well as 27 automotive component manufacturers.

Ilya Veselov said: “Currently production facilities operating in Kaluga Region manufacture automotive glass, bumpers, car body forged components, suspensions, levers, fuel and exhaust systems, as well as tires and many other products. The production facilities not only satisfy the local demand but also supply their products to automotive industry facilities located in other regions. Apart from that, Kaluga has become a member of New Silk Road, an international project serving the interests of Russia, China and South Korea economies.  This will definitely have a positive impact on Kaluga Region economy in general and the regional automotive industry in particular”.  

Kaluga Region applies a specialized investment contract as a timely measure to support the automotive industry fully in line with the Russian Federation law. There are plans to conclude such contracts with the Ministry of Industry and Trade of the Russian Federation to promote the development of Kaluga Region   automotive industry plants.

The goal of the contract is to motivate companies to invest in construction and modernization of production facilities in Russia through providing industry-specific benefits and preferences, as well as through formation of stable business conditions for investors fulfilling their obligations to build and/or modernize their plants.  

Applications to conclude the  specialized investment contract has already been submitted by Volkswagen and Volvo.

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