Automobiles sell so bad in Russia, so Dongfeng is go bottom fishing?

Recently, Economic Development Department of Samara Oblast in Russia revealed that China Dongfeng Yangtze Automobile Co.,Ltd has began its preparatory work that it handled the land procedures in order to establish Passenger Automobile Factory in Samara Oblast, according to the news from Russian “satellite” News Network.

Though Russian automobile market greatly declines, Dongfeng not only won’t slow down its step of entering into Russia market, but will deeply get rooted in it. Furthermore, ,Russian government once allocated 10 billion ruble aid funds to automobile manufacturers to help automobile industry to deal with economic crisis on March this year. At this time, Dongfeng will be welcomed for increasing investments to Russia, so it is perhaps the good opportunity for bottom-fishing now.

In fact, Dongfeng has already marched into Russia at an earlier time. On October 20, 2011, Dongfeng Automobile Co., Ltd, the China’s biggest automobile joint venture, conducted the ceremony of establishing Dongfeng Automobile Russia Co., Ltd in Moscow, which is Dongfeng’s first formal foreign sub-company. At that time, Dongfeng suggested in some aspects that Russian market is not only an important foreign market in the future, but one of the important joint cooperators in the future.

Dealers’ convention of Dongfeng Automobile Russia Co., Ltd was conducted on April, 2014, and the main models of Dongfeng Aeolus formally launched into Russian market. The initial demands are 1000 sets including the three models: Dongfeng Aeolus S30, H30 and CROSS.

Donfeng sold over 400 sets automobiles in Russia in the first half of this year. Up to now, Dongfeng has owned 36 4s stores in the 32 cities of Russia, but only two models S30 and H30Cross are selling , and AX7 has appeared in the local outlets.

But it is said that with profound cooperation between Dongfeng and PSA, it is quite possible for Dongfeng to  assembly produce passenger vehicles in Russia by virtue of PSA and Mitsubishi’ joint factory in Russia.

It is understood that 782 thousand light vehicles in the Russian market were sold in the first half year of 2015, greatly declining by 36.4 percent year on year. China’s automobile corporation even did worse than the whole market, with sales volume dropping about six-fold year on year, and many corporations sold zero vehicles, some corporation having stopped business in Russia. Russian sales volume of automobiles will be between 1.52 million and 1.75 million sets, the year-on-year decline of 10 percent expanding to 25 percent, PWC(Price Wterhouse Coopers) predicted.

Deriving from Wuhan Public Service Automobile Repairing Station in 1929, Dongfeng Yangtze Automobile established the factory in 1950, whose name was changed into Wuhan Public Service Passenger Vehicle Factory. It was renamed as Dongfeng Yangtze Automobile ( Wuhan ) Limited Liability Company ( short for “Yangtze Automobile”), specializing in complete vehicle research and development, manufacturing and selling of passenger vehicles in the city.