Daimler still plans Mercedes plant in Russia despite weak market

Daimler still plans Mercedes plant in Russia despite weak market

Automotive News Europe. – Daimler remains committed to adding a plant in Russia to support the ‘remarkable’ performance of its Mercedes-Benz brand, CEO Dieter Zetsche said.

“Yes, that is something we are pursuing,” Zetsche told Automotive News Europe this week at the auto show here.

The planned addition to the automaker’s production footprint comes despite a steep decline in Russian car sales. Through 11 months the overall volume in Russia was down 35 percent to 1,454,253, according to data from Moscow-based lobby group the Association of European Businesses.

Zetsche said Mercedes has done “extremely well” despite the country’s overall sales weakness. “Our market share is remarkable,” he said. “But, of course, we can’t totally go against the trend.”

Mercedes was the top-selling premium automaker in Russia through 11 months with a volume of 38,797 units and a 2.67 percent market share. BMW’s share was 1.74 percent while’s Audi’s was 1.60 percent. Mercedes’ sales drop was less than the declines at BMW and Audi (see chart, below).

Russian media reported last April that Daimler had narrowed the possible sites for a plant to three locations: St. Petersburg, where Toyota, Hyundai and Nissan have factories; Tatarstan’s capital, Kazan; or the central Russian region of Sverdlovsk.

When asked whether he sees Russian sales rebounding in 2016, Zetsche said: “It depends on Russia’s overall economic development, which depends on the overall political situation.”