DETROIT, Jan 13 (Reuters) - Russian vehicle maker GAZ Group
is in contact with "two or three" possible partners for its
primary operations of heavy vehicle manufacturing, GAZ
President Bo Andersson said on Wednesday.
Andersson would not name possible partners or characterize
the seriousness of any talks, other than saying he is in
regular contact with the potential partners.
Heavy vehicles including light commercial vehicles, trucks
and buses are the core of GAZ's business and it is No. 1 in
the Russian market in these areas, Andersson said.
Andersson spoke to Reuters on the sidelines of the
Automotive News World Congress in Detroit. He was a longtime
Saab executive at General Motors, where he last served as GM's
group vice president in charge of global purchasing and supply
chain.
Debt-laden GAZ is more interested in losing partners than
gaining them, and streamlining the company by cutting
employees, facilities and partnerships has been a key focus
since he joined GAZ in mid-2009.
"It seems like there is a lot of speed dating going on
because we have a lot of relationships and we are a relatively
small company so we cannot keep all of them," said Andersson.
"We are closing some of those out."
A major goal is cutting the scale of the massive GAZ Nizhny
Novgorod plant. By the end of 2010, about 100 of the buildings,
or 20 percent, will have been leveled since he arrived last
summer, Andersson said.
Andersson acknowledged that GAZ is considering expanding
passenger car production, but no time soon. GAZ's cars are
currently less than 1 percent of the passenger-car market in
Russia. "We are interested in partnerships in passenger cars," he
said, adding that he was disappointed that a deal to link GAZ
with GM's German unit, Opel, fell through.
GAZ Group was an industrial partner with Russia's Sberbank
(SBER03.MM) and Canada's Magna (MGa.TO) in a failed attempt
last fall to acquire control of Opel. GM decided to keep Opel
after initially trying to sell it as part of its U.S.-financed
bankruptcy and restructuring.
Andersson said he hopes a Gaz-Opel link can be established,
but for now the company needs to concentrate on its core
business. "We are looking at all options, but with a big debt burden,
and limited opportunities to invest in new (car) technology, my
first priority is commercial vehicles,"
Andersson said. "Our focus is on making money. It's much easier for us with
our fundamentals to be in commercial vehicles. We have the
market, we have the dealers. We have the customers. We don't
really have it on the passenger car side," he said after his
speech to the Automotive News conference.
The Russian passenger car business decreased in 2009 to 1.5
million units sold, down from about 3 million in 2008.
Andersson said the buying incentives announced on Monday by
Russian leaders will help boost sales in 2010, but only
slightly. Andersson said that even with the help of the Russian "cash
for clunkers" or "scrappage" incentive program to start in
March, sales in 2010 will rise only to 1.7 million units.
The Russian program sets aside 10 billion rubles -- about
$340 million -- to buy as many as 200,000 cars at least 10
years old if the purchaser buys a Russian-made car or one made
by a foreign automaker at a Russian plant.
GAZ operates across Russia and its 11 time zones and the
unwieldy nature of doing business there complicates the effort
to streamline the company, Andersson said.
Andersson said his managerial style has changed greatly
since he became head of a Russian company.
He has become "a little bit meaner," he said in a speech
peppered with one-liners. He added: "It's a military style and
if you don't raise your voice, they do not pay attention to
you."
is in contact with "two or three" possible partners for its
primary operations of heavy vehicle manufacturing, GAZ
President Bo Andersson said on Wednesday.
Andersson would not name possible partners or characterize
the seriousness of any talks, other than saying he is in
regular contact with the potential partners.
Heavy vehicles including light commercial vehicles, trucks
and buses are the core of GAZ's business and it is No. 1 in
the Russian market in these areas, Andersson said.
Andersson spoke to Reuters on the sidelines of the
Automotive News World Congress in Detroit. He was a longtime
Saab executive at General Motors, where he last served as GM's
group vice president in charge of global purchasing and supply
chain.
Debt-laden GAZ is more interested in losing partners than
gaining them, and streamlining the company by cutting
employees, facilities and partnerships has been a key focus
since he joined GAZ in mid-2009.
"It seems like there is a lot of speed dating going on
because we have a lot of relationships and we are a relatively
small company so we cannot keep all of them," said Andersson.
"We are closing some of those out."
A major goal is cutting the scale of the massive GAZ Nizhny
Novgorod plant. By the end of 2010, about 100 of the buildings,
or 20 percent, will have been leveled since he arrived last
summer, Andersson said.
Andersson acknowledged that GAZ is considering expanding
passenger car production, but no time soon. GAZ's cars are
currently less than 1 percent of the passenger-car market in
Russia. "We are interested in partnerships in passenger cars," he
said, adding that he was disappointed that a deal to link GAZ
with GM's German unit, Opel, fell through.
GAZ Group was an industrial partner with Russia's Sberbank
(SBER03.MM) and Canada's Magna (MGa.TO) in a failed attempt
last fall to acquire control of Opel. GM decided to keep Opel
after initially trying to sell it as part of its U.S.-financed
bankruptcy and restructuring.
Andersson said he hopes a Gaz-Opel link can be established,
but for now the company needs to concentrate on its core
business. "We are looking at all options, but with a big debt burden,
and limited opportunities to invest in new (car) technology, my
first priority is commercial vehicles,"
Andersson said. "Our focus is on making money. It's much easier for us with
our fundamentals to be in commercial vehicles. We have the
market, we have the dealers. We have the customers. We don't
really have it on the passenger car side," he said after his
speech to the Automotive News conference.
The Russian passenger car business decreased in 2009 to 1.5
million units sold, down from about 3 million in 2008.
Andersson said the buying incentives announced on Monday by
Russian leaders will help boost sales in 2010, but only
slightly. Andersson said that even with the help of the Russian "cash
for clunkers" or "scrappage" incentive program to start in
March, sales in 2010 will rise only to 1.7 million units.
The Russian program sets aside 10 billion rubles -- about
$340 million -- to buy as many as 200,000 cars at least 10
years old if the purchaser buys a Russian-made car or one made
by a foreign automaker at a Russian plant.
GAZ operates across Russia and its 11 time zones and the
unwieldy nature of doing business there complicates the effort
to streamline the company, Andersson said.
Andersson said his managerial style has changed greatly
since he became head of a Russian company.
He has become "a little bit meaner," he said in a speech
peppered with one-liners. He added: "It's a military style and
if you don't raise your voice, they do not pay attention to
you."