head of Avtotor Valery Gorbunov on loading and replacing BMW

Kaliningrad Avtotor plans to produce 70,000 vehicles in 2023. The Chairman of the Board of Directors of Avtotor Holding LLC spoke in an interview with Kommersant about how busy the site is now, his own electric car, plans for idle capacities and attracting new partners. Valery Gorbunov.

– How busy is production now?

“Our full load is about 250,000 vehicles when working in two shifts. 254 thousand were produced as much as possible. I’m talking about 2019 as a pre-crisis year. Therefore, capacities allow to produce 250-300 thousand, depending on the depth of technology. At the end of this year, we will load up to 30%.

– What volumes are produced now? For two months, dealers received 6,000 Kaiyi cars. There are also BAIC and experimental batches of SWM.

— We now make 600-1000 cars a month, depending on the models, and in the fourth quarter we should make up to 14,000 cars a month. Therefore, we are still “eating bread without butter”.

— You reviewed your special investment contract (SPIC) at the end of 2022, but there are still references to the future release of all Kia and Hyundai models. Will it be revisited?

— Today we are working with the Ministry of Industry and Trade on changing our SPIC. We do not change our obligations, despite the fact that we practically did not work for a whole year – we change our proper names (names of partners. – “b”). We had to agree with our partners that they were ready to go with us in accordance with the obligations that we assumed. I think that, perhaps, in July we will already prepare these changes with corrected proper names and confirmed investment obligations – as it was, for 32 billion rubles.

— Last year, you integrated an electric car into SPIK. Is this your own development?

– Yes. We will complete the design in August.

— You plan to launch the production of electric vehicles in 2024. Previously, it was only about the compact L7 class, but now you are talking about the full-size M1 car. Will it also be produced from 2024?

— An M1 class electric car is the next stage. The prototypes currently being made are the L7.

— After Kama presented Atom, did you somehow reconsider the positioning of your electric car?

– No. Competition is the mover of the market, the natural mover of production. We can only welcome this.

– From the point of view of competition in the internal combustion engine – you launched the release of Kaiyi E5, this is in fact the first sedan of the middle segment since the beginning of the crisis. Why choose this model?

“We were mainly focused on getting production back up as quickly as possible. But, of course, we worked with partners who would cover the needs in the class, on the one hand, and on the other hand, so that they would not compete with domestic cars. They were close, but not classmates with AvtoVAZ cars.

Is the Kaiyi E5, in terms of mass production, a replacement for the Hyundai Sonata, or was there no such plan?

— No, that was not the task. We are talking about releasing the same classes, but they are different things.

– Are there negotiations with really premium brands to put them on the power that is created under BMW?

— Yes, they are. Including those who will, relatively speaking, work in the BMW class. But we do not have the primary task of replacing someone. There is a business task so that we work in all classes and make a profit. We must give those consumer qualities that BMW gives. Our lineup previously included, for example, both BMW and Genesis…

But they are different classes, no?

– It’s a matter of taste. I bought a tie for a thousand rubles – they sell it around the corner for five thousand, run quickly, buy it. As a user, if the choice is between BMW and Genesis, I would prefer the Genesis. Purely subjective. These are taste things. Another thing is that the premium class is premium, and there is no getting away from it, and we must provide our products to this market.

We have a site where BMWs were produced before the start of the new plant that we built for them, and it is free, this conveyor is still empty. As soon as a brand appears that will give a load of 50 thousand cars, it may well be a candidate to come there.

– The question is in the volume of production, not in the class?

– Of course, in volume. But, of course, it is hardly advisable to place, say, class A or class B in those capacities that are created under the BMW X-series. BAIC is very close in terms of the volumes I mentioned and they are considering this. But we are also discussing the possibility of loading the lines with some kind of participation in the form of investments from the partner. The most expensive on the conveyor line is electronics and software. Stands and other electronic and robotic equipment that was used on the Kia and Hyundai conveyor cannot read the parameters set for Kaiyi and BAIC. We changed all this in preparation for the production of new cars. But we would like to attract investments using the new conveyor.

Interviewed by Olga Nikitina