"The automotive industry is not just an investment project, it should be regarded as a strategic national project that goes beyond the standard financial considerations normally taken into account by private investors and commercial banks," said Grigoriy Mikryukov, the Analytical Center expert, on the Development Projects show on Russia-24 TV channel.
The automotive industry is under heavy social responsibility
There is a clearly defined social aspect to supporting the automakers. Today, Russia’s automotive industry employes over 290,000 people. Car makers also buy goods and services from dozens of other companies. One job in the automotive industry creates 5-7 jobs in related sectors, Mr. Mikryukov explained.
Thus, providing loans to large scale investment programs of car companies is a key priority for Vnesheconombank (State Corporation "Bank for Development and Foreign Economic Affairs"). The bank hass provided a total of RUB 60 billion for the automotive industry modernization program. Some of this money has gone on the development of a completely new model range. In April Avtovaz for the first time in 2 years saw its sales go up. Sales were up 7.8% as compared to April 2015. At the moment, the company is implementing a large scale investment program which is going to cost it RUB 122 billion and is to be completed in 2020.