Kommersant. – The Ministry of Industry and Commerce intends to limit the access of car manufacturers, which do not use Russian metal in production, to government support, aluminium in particular, from 2019 onwards. The changes to the law have been prepared within the framework of the “road map” for the development of aluminium industry until 2023, in order to help the only primary aluminium producer in the country Rusal, which fell under US sanctions. Rusal exports 80% of its production. The company has sold 1 million tonnes of the 3.7 million tonnes of aluminium produced in the Russian Federation in the domestic market.
As written in Kommersant, the amendments determine the details of car production, such as: the proportion of Russian metal to be used, including aluminium. In total, the minimum share of Russian metal must be in between 50-80%. According to the draft resolution, the minimum amount of Russian metal to be used in car production must be 70%, as of 2019. The ratio falls to 50% for LCVs and buses. Similar rules apply to truck cabin production. 60% of the metals used in truck and bus frame production will have to be Russian from 2023 onwards, as a minimum requirement. The same will apply to car and LCV frames as of 2025. At least 80% of metals used in subframe production for cars and LCVs will have to be Russian as from the year 2023.
It should be noted that comparatively less aluminium is used in car production, where bodies are made of steel, in particular.
According to Wilhelmina Shavshina from a law firm, the proposed amendments should generally be observed within a strategy of import substitution, for the purpose of localisation increase. “The only issue is that whether the car manufacturers are ready for a reduction in quality, which is usually the case when working with local suppliers” – Shavshina added.
