Lada Latino.

• Author: Luxner, Larry
• Position: Russian automaker in Uruguay and Colombia

Russian automaker Lada, whose boxy little cars have long been a common sight throughout Cuba, will soon begin assembling vehicles outside Russia for the first time ever. Within the next few months, factories are to begin churning out Ladas in Uruguay and Colombia - mainly for export to Mercosur and Andean Pact nations.

So says Rafael Anssens, sales manager for Motores Internacionales S.A. in Panama, which has exclusive Lada distribution rights for twenty-four Latin American and Caribbean countries.

According to Anssens, Lada would begin by manufacturing three hundred units a month in Cali, Colombia, through a local joint venture. Lada will produce a similar number of vehicles in Uruguay in partnership with Montevideo auto distributor Efecto S.A., possibly at an idle auto-assembly plant in the Nueva Palmira free zone previously used by Volkswagen.

"We want to be very prudent," says Anssen. "We don't want to invest too quickly and have financing problems later. We will begin very slowly, only with some models we know will be accepted."

One such model is the three-door Samara 1300, which, like all other Ladas, is currently assembled at Russia's Togleatti auto plant. That factory produces 700,000 vehicles a year; most of those are destined for Eastern Europe, China, Turkey, and the Far East, though about 50,000 Lada cars end up in Latin America. At an average cost of US$8,000 per car, that comes to annual sales of US$400 million.

Of course, that pales in comparison to most of Lada's competitors. Renault's chief executive, Pierre Poubel, recently confirmed that his company will invest US$1 billion in a Brazilian auto plant before 1999 for the production of 100,000 passenger cars a year. Meanwhile, Herbert Berger, president of Daihatsu do Brasil, says he is considering Minas Gerais as the site for a factory that would produce 10,000 Daihatsu cars a year. Toyota...