AvtoVAZ Expands Lada Granta Production to Second Plant

VIENNA – Volume production of the Lada Granta low-cost sedan begins at the IzhAvto plant in Izhevsk, the capital of the Russian Republic of Udmurtia.

IzhAvto is the second factory building the Granta, following Lada manufacturer AvtoVAZ’s November launch of serial production at its plant in Togliatti, Russia. Stamped parts for the Izhevsk-made Grantas are sourced from AvtoVAZ.

AvtoVAZ took over the bankrupt IzhAvto plant in October to add capacity both for its Lada models and those of its alliance partners Renault and Nissan. AvtoVAZ owns 100% of Obyedinennaya Avtomobilnaya Gruppa, the company managing production at the facility.

Lada Granta is IzhAvto’s first new model since being acquired by AvtoVAZ. Investment in modernizing the plant and retooling for the Granta totals RR1.36 billion ($41.2 million).

“The start of production of the Lada Granta in the Izhevsk car plant is a symbol of the renewal of our company,” says OAG managing director Aleksey Alekseyev.

The Alliance Vehicle Evaluation Standard developed by Renault-Nissan is being used to evaluate quality.

The body shop employs 24 robots. IzhAvto is painting the Granta in three colors, with more added in 2013.

Production at Izhevsk is starting off with the Granta’s least-expensive equipment level, Standard, with a base price of RR259,000 ($7,856) in Russia. The costlier Normal version follows in September.

IzhAvto still produces two aging rear-wheel-drive models, the Lada 2104 station wagon and the 2104-based Izh 27175 light-delivery van. Both vehicles are expected to be phased out later this year.

About 55,900 vehicles, including up to 27,000 Grantas, are scheduled to come off the line at IzhAvto this year. The factory is capable of producing up to 95,000 Grantas a year, based on 25 cars an hour in a 2-shift operation.

In addition to the Granta sedan, AvtoVAZ will begin building a hatchback version of the low-cost car in 2014. Izhevsk will be the sole Russian production site.

AvtoVAZ plans to invest about RR10 billion ($303 million) in IzhAvto by 2016, including money already spent on the Granta project. According to information published earlier, IzhAvto’s annual capacity is to be increased from 220,000 units to 360,000.