Republic of Uzbekistan President Visits GM's Korea Operations

Republic of Uzbekistan President Visits GM's Korea Operations  
Filed under:
News, General Motors
on 02/26/2008

Source: General Motors

General Motors Corp. and UzAvtoSanoat of Uzbekistan signed a series of agreements today at GM Daewoo Auto & Technology (GM Daewoo) in the presence of Republic of Uzbekistan President Islam Karimov, who is making a visit to Korea. “The partnership between UzAvtoSanoat and General Motors will help drive the automotive industry of Uzbekistan towards new level of development,” said President Karimov. “Our goal is to build a world-class industry that benefits the people of Uzbekistan by providing them a broad range of modern, attractive and affordable vehicles.”

According to today’s agreements:

- The Chevrolet Lacetti will be assembled in Uzbekistan within this year from component kits supplied by GM Daewoo. The Lacetti will be the fourth Chevrolet model built by UzAvtoSanoat in Uzbekistan, joining the Captiva, Epica and Tacuma.
- GM Daewoo will provide UzAvtoSanoat technology and engineering support to enable it to become integrated into GM’s global manufacturing network.
- GM is extending to UzAvtoSanoat the right to distribute Chevrolet brand products manufactured in Uzbekistan domestically as well as, via GM’s sales operations, in the Commonwealth of Independent States (CIS).

The agreements signed today are a follow-up to an announcement made by the partners last October that they would establish a joint venture in 2008. The manufacturing plant that will become the mainstay of the joint venture is situated in Asaka, Andijan province, 350 kilometers from the Uzbek capital, Tashkent. It has an annual manufacturing capacity of 250,000 units. In addition to its home market, it is helping meet the needs of neighboring markets.

“The production of a range of Chevrolet models in Uzbekistan is part of a broader push by GM across Central and Eastern Europe,” said Eric Stevens, GM Europe Vice President of Manufacturing. “Chevrolet cars and SUVs are now being built in Uzbekistan, Russia, Ukraine, Poland and Kazakhstan.” Chevrolet sales in Central and Eastern Europe increased from 140,000 units in 2005, when the brand was re-launched, to 288,000 units in 2007.

During today’s signing ceremony, which took place at GM Daewoo’s Bupyeong headquarters in Incheon, UzAvtoSanoat Chairman U. Rozukulov and GM Daewoo President and CEO Michael Grimaldi confirmed their agreement to the GM-Uzbekistan joint venture company charter, which is subject to the approval of the shareholders of the company when GM makes its investment in the near future.

GM will hold a 25 percent equity stake in the joint venture, with the option of increasing its stake. GM will provide new technology, manufacturing expertise and training for the joint venture’s 4,700-member workforce. The joint venture will have access to the portfolio of Chevrolet, GM’s largest and fastest-growing global brand.

“Along with GM Europe, we are pleased to have joined forces with a reliable manufacturing partner, UzAvtoSanoat,” said Grimaldi. “The new GM-Uzbekistan joint venture will give GM additional manufacturing capacity required to keep up with the rapidly growing demand in Central Asia and Eastern Europe.”

With a population of 27 million, Uzbekistan has a vehicle market with significant potential for future expansion, according to GM. The country’s economy has grown more than 7 percent over the past five years. In 2007, vehicle sales surpassed 70,500 units, which represented an increase of 7.5 percent from the previous year. In 2007, GM Daewoo exported to Uzbekistan more than 170,000 complete knockdown (CKD) and semi-knockdown (SKD) kits of parts and components for local assembly.

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