Volvo Trucks Inaugurates New Production Plant in Russia

Volvo Trucks inaugurated its Russian production plant in Kaluga, coinciding with the introduction of new, higher Russian custom duties for imported trucks.

Volvo Group is making long-term strategic investments in Russia – both in the service and retail network and in its industrial presence. Volvo Trucks established so-called CKD-production six years ago in Zelenograd outside Moscow. With a capacity of 500 trucks a year, this plant is now under-dimensioned for the Russian truck demand, which has increased significantly.

The new plant is situated in Kaluga, 125 miles southwest of Moscow. It will produce trucks for Russia and neighboring markets within the CIS-region, where the new custom duty levels are introduced as of January 12. Depending on type of truck, the custom duty is now between 5 and 25 percent.

The new factory has a capacity of 10,000 Volvo and 5,000 Renault trucks. Production will start with low volumes in order to adjust and fine tune the production process. Production volumes then gradually will be increased according to market demand. The assembly line will be provided with cabs, drivelines and gearboxes from Volvo’s Swedish component factories.

Volvo has 39 authorized workshops in Russia, including 2 fully owned Volvo Truck Centers in St. Petersburg and Moscow. A third fully owned center will be opened later this year in Kaluga. During January to November 2008, Volvo Trucks delivered 5,466 trucks to Russian customers, compared to 3,904 trucks for the same period 2007. About 5,000 used Volvo trucks where imported during the same period. The Russian market is judged to have a long-term growth potential. Due to the global economic uncertainty the demand of trucks has slowed down. Today the actual population of Volvo trucks in Russia exceeds 50,000 units.

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