BIRMINGHAM, England -- General Motors and AvtoVAZ will keep their profitable Russian joint venture, AvtoVAZ CEO Bo Andersson said.
GM is ending sales of mainstream Chevrolet models and all Opel cars in Russia, and closing its St. Petersburg factory, after sales slumped in the country's economic crisis.
Andersson said GM will continue to participate in its Russian joint venture with AvtoVAZ in Togliatti that builds the Chevrolet Niva SUV.
"GM-AvtoVAZ has made money during all of the 13 years it has been in operation," he said at the Automotive News Europe Congress here last week.
The Niva is mostly sold in Russia through different dealerships than Opel and other Chevrolet models, so sales will not be affected by GM's exit from the country, Andersson said.
Andersson is a former GM global purchasing chief. He is chairman of the GM-AvtoVAZ joint venture in addition to heading AvtoVAZ, which is 51 percent owned by Renault-Nissan.
Andersson expects the joint venture will sell about 40,000 Niva models this year. The SUV starts at 449,000 rubles ($8,269) and appeals to "hunters and fishermen," he said.
Through May, Niva sales in Russia were 11,647, down from 18,192 in the same period last year, according to the Moscow-based Association of European Businesses.
The Niva will be replaced in 2017 with an all-new similarly rugged model, Andersson said.