General Motors has suspended work on a planned replacement of its last remaining Russian-built vehicle, the Chevrolet Niva SUV, the company said.
The Niva is built by Russia's AvtoVAZ at its factory in Togliatti as part of a joint venture between the company and GM. The small SUV was launched in 2002 and a replacement had been previewed at the 2014 Moscow auto show, with a launch planned for 2016.
"Works within the new-generation Niva project are suspended due to several objective reasons," GM-AvtoVAZ said, without naming those reasons.
GM largely pulled out of Russia in 2015 when it stopped making cars for its Opel brand there amid an ongoing economic crisis in the country.
The Niva survived, however, and is sold at about 100 stand-alone dealerships in the country dedicated to the model. The car was Russia's No. 19-selling model in the first eight months of the year with 18,456 registered, data from the Association of European Businesses (AEB) shows.
"The company is profitable so there's no urgency to replace it," said Nicolas Maure, chairman of GM-AvtoVAZ and chairman of the Renault Group in the Eurasia region.
Renault owns AvtoVAZ. AvtoVAZ’s role is financial partner and contract manufacturer for the vehicle, Maure said. GM oversees engineering. He declined to say why GM had cancelled the replacement.
GM-AvtoVAZ said it hadn't abandoned development of the current model. "We are constantly working on improving the quality and performance of the vehicle to keep customers' interest in our product," a spokeswoman said.
Before the JV was established with GM, the Niva had been developed by AvtoVAZ to replace the Lada 4x4 small SUV. The 4x4 once carried the Niva name and still does in export markets.
Lada is planning to develop a replacement for the 4x4, which was first launched in 1977, and would like the Niva name back.
"If there is an opportunity to buy it back, it would make sense. It still has a strong brand image, not only in Russia but also abroad. It's a question of price," Maure told Automotive News Europe.
Maure said the replacement would not continue using the 4x4 name.
GM's Ravon brand meanwhile has abruptly ended sales in Russia, without explanation. Ravon is owned by GM Uzbekistan, a joint venture between GM and UZauto that builds older, Korean-developed GM models such as the Spark minicar in the former Soviet country.
The brand registered zero cars in June, July or August and sales are down 33 percent for the year. Last year Ravon came from almost nowhere to register 15,078 cars in Russia, according to the AEB. In December it agreed a deal to sponsor the Russian national soccer team.
GM continues to export Cadillacs and high-end Chevrolets into Russia. Cadillac sold 676 cars in the country through August, down 22 percent on the year before.
