AVTOVAZ Reached 19.8% Passenger Car Market Share in 1H 2016
- LADA reached Russian passenger car market share of 19.8% in 1H 2016 (+0,8 pt vs 1H 2015)
- The revenue reached 87.1 B RUB, down 5% driven by the on-going market drop
- The first half-year showed an operational loss of -27.6 B RUB including impairment, and -8.6 B RUB without impairment
- The operational results before impairment in Q2 show preliminary signs of improvement and they are better than in Q1
- Further strong cost-reduction measures will be implemented by our new Chief Recovery Officer and 11 cross-functional teams.
AVTOVAZ Group reported its 1H 2016 IFRS results. LADA achieved a market share on the Russian passenger car market of 19.8% after 19.0% in 1H 2015. LADA domestic retail sales amounted to 124 353 units, 11.6% below 1H 2015, but better compared to the overall passenger car market drop of 15%. The production volume of LADA, Renault, Nissan and Datsun brands (including CKD kits) amounted to 200 424 units.
The Group’s revenue reached 87.1 B RUB, 5% less than in 1H 2015. The operational loss amounted to -27.6 B RUB, including impairment. These impairment mainly relate to a lower capacity utilization, following IFRS accounting rules. Operational loss before impairment amounted to -8.6 B RUB (increase on 67%). The losses without impairment effects in Q2 amounted to -2.0 B RUB and are better than the losses in Q1 (-6.6 B RUB), partly driven by our recovery program.
Within this recovery program, 11 cross-functional anti-crisis groups were founded, are reporting on a weekly basis to the AVTOVAZ Executive Committee and receive full support. Since July, 4th, the groups are coordinated by our new Chief Recovery Officer – Elena Frolova, the first lady in AVTOVAZ’s top-management team in years. AVTOVAZ strengthens its thorough program to protect its cash.
``The financial recovery plan implementation in the Q2 2016 shows some preliminary signs of improvement, especially when analyzing month-to-month figures, - stated AV Group President Nicolas Maure. – Since Q2 2016 we see that the management is turning to cross-functional teamwork with more efficiencies in all areas of the company. There is still more time needed for a strong improvement of AVTOVAZ financials. We are taking all possible actions to fight the negative effects of the Russian car market drop and exchange rate fluctuations, using all available instruments and leveraging the support provided by the Government and our shareholders``.
Our new X-Style models Vesta and XRAY are positively received on the Russian market, and customer demand exceeds our expectations. All LADA models are present in the list of the state demand stimulation programs (scrappage, trade-in, leasing). The whole LADA vehicle line-up along with some novelties will be presented to the public during the Moscow Motor Show starting August, 24th.
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JSC AVTOVAZ is an unique plant; it is the biggest manufacturer of Renault-Nissan Alliance in Russia and one of the biggest in the world. JSC AVTOVAZ is the only plant among 46 Alliance’s plants, which is capable of full-cycle production of 4 brands (LADA, Renault, Nissan and Datsun).
In the second half of 2015, AVTOVAZ started assembly of LADA Vesta and LADA XRAY; these cars will assure complete renewal of LADA brand and new prospects of its development.
Today LADA is represented by a 20-model line-up in В, В+, SUV and LCV segments,and on the domestic market is priced between RUR 384K-850K.
Press service ОAО AVTOVAZ