Magna to launch auto parts plant in St Petersburg in 2011

ST. PETERSBURG, October 3 (Itar-Tass) -- Canadian Magna will open a
car component plant in Shushary outside St. Petersburg in January 2011,
Magna St. Petersburg Regional Director Vadim Ustinov said.
He said Phase One of the plant would go on line in the spring of 2010.
The project is estimated at 80 million euros and will initially make
moulded parts.
Magna has an arrangement for the supply of auto parts to Hyundai, Ford
and Nissan plants. "We are also considering the General Motors plant in
St. Petersburg as a potential partner," Ustinov said.
Magna has launched the rpoduction of plastic parts for Ford plants at
St. Petersburg's Izhora Works and is cosponsors the production of auto
parts for Hyundai in Kamenka, St. Petersburg. The company plans to launch
the production of up to 300 auto parts in St. Petersburg by 2012.
According to Ustinov, Magna considers the Russian automobile market as
promising. "We believe in the Russian economy. Despite the crisis the
Russian automobile market is normalising," he said.
Magna also plans to develop production in St. Petersburg, Kaluga and
Nizhny Novgorod. The plant in Kaluga is expected to become operational in
the first quarter of 2011. In Nizhny Novgorod, it plans to set up a
production facility at the Tekhnoplast plant and create an engineering
centre.
Ustinov expressed confidence that Magna's joint deal with Sberbank
would not affect the company's preliminary agreement, and the company
would compete with other manufacturers of auto parts on equal terms.
Magna International and Sberbank will invest 500 million euros in the
authorised capital of the German car manufacturer Opel.
The proposal suggests that Magna and Sberbank will split the package
fifty-fifty.
General Motors will retain a 35 percent stake and the remaining 10
percent of shares will go over Opel's employees under the terms of a new
labour contract.
Opel is a German automaker. The company was founded in January 1863,
began making automobiles in 1899, and was acquired by General Motors in
1929. As part of GM Europe, Opel is GM's largest European brand and, along
with Vauxhall Motors in the UK, it forms GM's core European business.
In early 2009, the future of Opel was thrown into uncertainty as the
global financial crisis drove GM towards bankruptcy. New GM Europe (Opel
plus Vauxhall, minus Saab), is presently controlled by a trustee, with a
controlling board made up of representatives from GM, employees and the
German Government; the company was subject to a bidding process.
On September 10, 2009, it was announced that Magna and Sberbank would
buy a majority stake (55 percent) in its European Opel/Vauxhall
operations. GM will own 35 percent of Opel; while Opel employees will own
10 percent. The agreement will keep Opel/Vauxhall a fully integrated part
of GM's global product development organisation, allowing all parties to
benefit from the exchange of technology and engineering resources.
Following the global financial crisis, and GM's plunge towards
bankruptcy, on May 30, 2009, it was announced that a deal had been reached
to transfer New GM Europe (Opel plus Vauxhall, minus Saab) assets to a
separate company, controlled by a trustee.
On September 10, 2009, GM sold its European operation to the Magna
group with the approval of the German government.
-0-zak