Russia: Mercedes-Benz could start local production image

Daimler AG, the German parent of the luxury brand Mercedes-Benz is now weighing the option of starting local manufacture of Mercedes cars in Russia – in an effort to widen its global manufacturing sites.

Russian newspaper Vedomosti was the first to report the news, confirmed by a Daimler spokesman, Sebastian Wahle. He did not give any indications on the time frame on the decision, only disclosing that Mercedes-Benz is striving to further expand its production capabilities in order to reach its 2020 internal goal.

“We have been looking at the basic parameters and potential of local production of passenger cars in Russia, and have held various discussions,” said Wahle. “These activities will be continued.”

While the country is battling a falling demand in new car sales, a fact aggravated now by the Crimean crisis, Russia is still attractive to Mercedes as the country has a bigger growth potential compared to Germany – 2.95 million cars were sold there in 2013, with an 80 million population, while Russia had sales of 2.78 million units for an 142 million population.

Daimler is already present in Russia, albeit only through producing an older version of the Sprinter van and having a joint venture with OAO KamAZ that sees Mercedes-Benz truck cabs, engines and axles provided to the Russian heavy trucks manufacturer.