Chinese cars assembled at the Avtotor plant are slowly being sold

The Avtotor Kaliningrad Automobile Plant is expanding its line of manufactured models with several crossovers from the Kaiyi, BAIC and SWM brands at once. Nevertheless, so far sales of Kaiyi and BAIC assembled at Avtotor are low: since the beginning of the year they have amounted to less than 3 thousand cars, although the plant has already assembled 40 thousand of such cars. In corporate parks and for personal ownership, they mainly choose other brands from China, which have been on the market for a long time, analysts say. However, Avtotor says that by the end of the year they will assemble 70 thousand Chinese cars, linking the gap between production and sales with a long process of car certification.

Kaliningrad Avtotor is expanding its lineup with several crossover models: Kaiyi X3 and X3 Pro, BAIC BJ40, as well as SWM G01, G01F and G05 Pro. In autumn, it is also planned to assemble the Kaiyi X7 Kunlun crossover. Recall that the SUV is the most popular segment of the market, while the competition in it is higher.

The car factory began production of Chinese brands in January, starting with the Kaiyi E5 sedan. The assembly is being carried out at facilities where Korean Kia / Hyundai cars were produced until October 2022. “As part of a partnership with leading Chinese automobile companies, we intend to gradually increase production capacity, improve the efficiency of technological processes and the level of localization, which will expand the audience of consumers, make products more attractive in terms of cost and have a positive impact on the economy,” said on August 21 during the MIMS General Director of Avtotor Autoholding Evgeny Petukhov. We are talking about a gradual transition from SKD to a full cycle with welding and body painting.

As Kommersant wrote on January 31, the distribution of cars new to the market brands is carried out by structures associated with the family of the founder of Avtotor, Vladimir Shcherbakov. Kaiyi, BAIC and SWM do not independently provide sales data to the Association of European Businesses.

According to Avtostat (based on the data of the Electronic Passport), only 2.6 thousand Kaiyi cars were sold in the Russian Federation in January-July. At the same time, sales of the Kaiyi E5 officially started four months later than the start of production – in May at a price of about 2 million rubles. The total sales of new cars in January-July and June-July amounted to 497.2 thousand and 178 thousand, respectively. BAIC cars (the assembly of the BAIC U5 Plus sedan and the BAIC X35 crossover at Avtotor started in April) sold only 113 units in seven months, according to Avtostat data provided by Kommersant. SWM has not yet appeared in the implementation statistics.

The car market of the Russian Federation was actively recovering this summer, and in July sales of new passenger cars reached the level of a record 95 thousand units since February 2022 (see “Kommersant-Online” of August 4). However, in August, against the backdrop of a depreciation of the ruble and an increase in salvage fees, automakers massively began to raise prices, which affects demand. In addition to domestic AvtoVAZ, Chinese Chery, Haval and Geely are among the market leaders.

Sergey Udalov from Avtostat notes that brands from China that entered the market before the crisis were able to build consumer confidence. Avtotor, on the other hand, brought to the market a line of brands unknown in the Russian Federation, and, probably, the distributor has not yet been able to make them understandable to the market, he continues. The same Kaiyi E5 sedan has entered a seemingly empty niche: nevertheless, in corporate parks where such cars have traditionally been popular, it has not yet become noticeable, the analyst says, while the JAC J7 is already often found in taxis of the “comfort +” segment. “. “If we talk about individuals, then they also need some reason to choose a non-budget Lada Granta or a returned Vesta,” Mr. Udalov concludes. “So far, we can’t talk about large sales volumes: for people to believe in them and start buying, investments are needed.”

In Avtotor, Kommersant explained that the low sales rates are associated with long-term certification, which affects the pace of shipments.

The plant plans to produce 70 thousand cars in 2023.

And now, as they say in the company, there are about 40 thousand cars in the production chain of the plant, including those that are in the process of assembly. They did not specify to Kommersant how many of these vehicles were shipped.

Olga Nikitina