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Russia plans to sign special investment contracts with Hyuindai, BMW before year end

Special investment contract is a new mechanism to support foreign and domestic automobile producers

ANOSINO /Moscow Region/, April 7. /TASS/. Russia’s Industry and Trade Ministry expects to sign special investment contracts with German carmaker BMW and Korean Hyuindai before the end of 2018, Industry and Trade Minister Denis Manturov told reporters.

Special investment contract is a new mechanism to support foreign and domestic automobile producers. Its key advantage is in guaranteeing standing taxation conditions in exchange for a guarantee of investments to be made by the business.

Hyundai plans production of engines in St. Petersburg in the next three years. As part of this project the signing of a special investment contract is expected. The annual capacity of the production facility will be 150,000 units. This will help the company to increase local manufacturing content to 60%. Hyuindai already has its own plant in St. Petersburg - Hyundai Motor Manufacturing Rus, which produces models of Hyundai Solaris, Hyundai Creta, Kia Rio and Hyundai Creta.

For several years, BMW has been assembling its cars for the Russian market in Kaliningrad (the country’s westernmost region) at the site of the local carmaker Avtotor. However, taking into account the changes in the rules for obtaining discounts and subsidies for automotive companies, the assembly site has become less profitable.

In 2017, BMW announced plans to make a final decision on construction of a full-cycle plant in Kaliningrad. By June, BMW, Avtotor, the Industry and Trade Ministry are to determine the terms of a special investment contract. In early 2018, BMW announced the establishment in Kaliningrad, a subsidiary of OOO BMW Rusland Automotive.

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Top stories from the Russian press on Tuesday, November 19th

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"There will always be an answer," the president said

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Dmitry Peskov added that there have been no contacts via this new channel lately

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Japanese lawmaker praises Putin's restraint amid decision to strike deep into Russia

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Boris Ruge argued that NATO now has hundreds of thousands of troops that could be deployed to the alliance's eastern flank or elsewhere within ten days

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Top stories from the Russian press on Thursday, November 21st

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Tit-for-tat measures will be implemented after receiving information about unfriendly actions of Western countries, Anton Siluanov noted

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Xi Jinping calls for unification of more voices for peace in Ukraine

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Moscow won’t allow US to silence UNSC as Washington backs Israel — Russian UN envoy

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