Avtovaz Lada: the History of Manufacturer

Avtovaz Lada: the History of Manufacturer

182

If you ever wondered what Lada’s moto sounds like it’s “Lada is the key to Russian roads”, and being the biggest car manufacturing company in the country and one of the biggest ones in eastern Europe over the years it has proven its moto to be true. Now the stake belongs to Renault-Nissan Alliance, which has provided AutoVAZ with more opportunities and boosted the production processes.

VAZ Lada Kalina

Currently the company is called “AutoVAZ” JSC, but it hasn’t always been called this way. From 1966 till 1971 the factory was called Volzhskiy Automotive Factory – VAZ (Z stands for Russian “zavod” which means “factory”), and from 1971 till the Renault-Nissan takeover it was called AutoVAZ or Volzhskiy car manufacturing alliance.

At the moment the company belongs to Renault-Nissan alliance and produces cars under Lada, Renault, Nissan and Datsun brand names. Most of the premises as well as the headquarters are situated in Tolyatti, and it has been there since Russian AutoVAZ manufactured its first car.

AutoVAZ Brand History

Origins

The Cold War was on its peak in the 60’s and of the factors which bothered Soviet Government at that time was that The USA could boast an astonishing 1 car for each 3rd citizen, while in the USSR these statistics was much more disappointing: only one person out of 238 had an automobile. Car manufacturing volumes of the USA measured by millions a year, while those of the USSR only by thousands. Measured had to be taken to fix that situation quickly.

zhiguly

The easiest way was to follow the beaten track and to use the same pattern Gorkovskiy factory had been built in the 30’s. What happened then is that they signed a “technical support” contract with American Ford Motor, which gave them an opportunity to manufacture over 100 thousand cars – both passenger and cargo vehicles – just in 3 years from 1932 till 1935.

The idea was actually so good that it could kill more than two birds with one stone. In terms of external economy it provided an opportunity to set trade economic connections, to adopt successful experience in manufacturing processes organization and to acquire groundbreaking technologies which would allow to catch up with other counties equipment-wise. Why had they fallen behind in the first place? Too much focus on the military car manufacturing and too little on the civil one meant there were no engineers who could design a proper civil car and there was no time for them to study the subject.

Since the USA was no longer an option, the USSR negotiated with Britain, France and Germany, but the ally was finally found in the face of Italy. On Augest, 15th 1966 in Moscow Fiat CEO Gianni Agnelli and the minister of automobile industry Alexander Tarasov signed a contract, according to which a modern car manufacturing factory was supposed to be built in Tolyatti.

First Models of AutoVAZ

The new AutoVAZ company was going to manufacture a sedan, a vagon and a sedan-luxe, and the-car-of-the-year Fiat-124 was chosen as the prototype for the very first car with a couple of adjustments introduced to suit Russian roads better. The car body was strengthened, the clearance became bigger and the rear disk brakes, which were too sensitive to dirt, were replaced with the drum ones. The cam-shafts in the engine were modernized, the rear end suspension became sturdier, the front seats could now be transformed and the handles became safer.

VAZ-2101 first car

What we call VAZ 2101 was called Fiat-124R (R stands for Russia) and the model made it to the market with the first batch sent to Moscow on October, 28th 1970. That happened three years earlier than it had been planned and the USSR got to save about billion roubles thanks to it. The first car was labeled “Zhiguli” as a tribute to mountain s near Tolyatti, and the name stuck with the car since then.

The first production line of Togliatti AutoVAZ was started a bit later, in 1971, and it was supposed to manufacture about 220 thousand cars a year. In 1972 another line was launched which doubled the production volume. Having been in business for 3 years, the factory work was finally confirmed by the Government after 1 million cars had been already manufactured.

Manufacturer AutoVAZ after the USSR

Dissolution of the USSR meant crisis for AutoVAZ Russian car manufacturer, which it only overcame in the 90’s, having settled its own line. The first Russian AutoVAZ model VAZ-2111 was launched straightaway and in a couple of years the first Russian hatchback VAZ-2112 found its place on the market. That was the beginning of the factory’s modern history.

AutoVAZ Brand Names

AutoVAZ is the owner of several brand names from Zhiguli, Samara and Sputnik to Niva and Oka. There were also quite a lot of cars with unique design like E-Oka working on electricity, Niva with Buran shuttle engine or a Golf-class sedan. All of these experimental molels along with Putin’s yellow Lada Kalina you can find in the AutoVAZ museum. Every time a new model was launched it became really popular with Russian citizens, yet the most popular car of all times would probably be VAZ-2106 Fiat-124 Speciale prototyped for.

OKA VAZ

Currently Russian car manufacturer AutoVAZ is the owner of 5 car families which are being produced at the moment:

  • Lada 4X4 AutoVAZ Lada model is a 3-door vagon SUV full-drive off-road car which was called Lada Niva until 2005. The Lada 4X4 Urban version for city driving was launched in 2015. Niva became one of the most popular brands of the Russian car manufacturer AutoVAZ.
  • Lada Priora is one of the most demanded AutoVAZ cars at the moment because it’s really affordable and it was probably the first Lada car to get positive reviews by international Auto Magazines.
  • Lada Granta has Renault Logan as the prototype, which has been really popular in Russia. No wonder a cheaper AutoVAZ Tolyatti model became even more popular. Actually it’s the most affordable car from the ones which are on the AutoVAZ line now.
  • Lada Kalina became available for purchasing in 2006 in three body types: a sedan, a hatchback and a little bit later – a vagon. In 2007 the car was modernized to match Euro-3 standard and to be more fuel-efficient.
  • Lada Largus was designed to substitute VAZ-2102, then VAZ-2104 and a bit later VAZ-2111 vagons, but in contrast to the outdated models it also had a 7-seat family configuration and a “Furgon” modification designed for entrepreneurs and other kinds of businesses.

Lada 4X4

Apart from Lada models Russian car manufacturer AutoVAZ now also produces cars under Nissan, Renault and Datsun brand names. But can it really be called “Russian” now that 63% of shares belong to Renault-Nissan Alliance?

Export of AutoVAZ cars

Welcome, Niva

The most successful AutoVAZ Togliatti model is and has always been VAZ-2121 “Niva” which got Lada Niva export name. This car is considered to start off crossover manufacturing all around the world and here’s why it was so good. Before Niva was launced in 1978 off-road cars were way too big and expensive. But Niva, being pretty cheap, let a lot of people get a 4X4 and soon due its functional features had no competition left on the market. After the first month of sales it had about 40% of the European market and remained on top in its class for 15 years. By the end of the 80’s there were so many Nivas in Europe that a couple of Niva runs were organized across the Alps for Niva owners exclusively.

Export decrease

Up to 1994 about 30-40% of manufactured cars were exported, but by 1996 there had occurred a drop in sales by about 40%, and for the UK, Finland, Germany and France this percentage was even worse: a dramatic 80%. If in 1988 147 134 cars were exported to Europe the figures in 1995 turned out to make only 42 775 cars. Without AutoExport support AutoVAZ in Russia had to try and manage export by itself and it did by buying out AutoExport daughter companies like Conela, Lada Canada and Deutsche Lada. Yet with these companies came a lot of debit debts which the factory now had to repay. The exchange rate band introduced in 1995 made the situation even worse as the materials, details and the manufacturing process now became more expensive which increased the final price of the cars. The prices kept growing and within a couple of years the main thing which made AutoVAZ cars demanded by that time – the price tag – was gone. Export became no longer profitable, but the factory continued exporting cars at the cost of not being able to buy imported parts and invest in further development. On top of that in Europe new standards were introduced in terms of ecology, competitors from Asia got better at making cars and it seemed that Lada Export was over for good.

Is it going to change?

Lada Granta

In the 2000’s AutoVAZ Lada and Niva export started to grow again, even though most of the importing countries are those who once were part of the USSR. Yet here’s the big achievement: the sales in Germany increased by 100% by 2009. Sure it only makes 744 cars, but you have to start somewhere. At the moment Lada is not likely to regain its popularity any time soon, but still once the situation might change. On the official AutoVAZ site you can read that among the priorities of the company at the moment are a 20% share of Lada on the Russian market, an increase in export by at least 50%, 6 new models coming and an increase in quality and efficiency. With plans like these they do might not only keep the leadership in the economy segment but also expand to new segments and even markets.

Experimental Lada AutoVAZ Models

In 2015 a new Lada AutoVAZ model sales started in Russia and the car features an absolutely new platform. It can boast a unique style and competitive features. We’re talking about Lada Vesta here. And in 2016 a compact Renault Sandero-based crossover Lada X-ray was introduced. Despite it’s not a full-drive car it can be used as an off-road vehicle id the road is not too bad due to high clearance and geometrical features.

Also there’s a new turbo engine being developed at AutoVAZ in Togliatti in Russia and the VAZ-11192 model designed with help of British Ricardo.

Expos

  • In 1992 “Gnom” model took part in “Avtoindustria-92” expo in Moscow. Its 3-meter-long body was based on shortened Oka platform and prevailing amount of plastic parts made it the lightest in its class.
  • In 1994 in Paris VAZ-2110 was introduced for the very first time.
  • In 2004 in Switzerland all Lada 110 cars, injector AutoVAZ Niva and “Roadster” concept car were displayed.
  • In 2016 in Moscow 6 conceptual cars took part: 4 off-road and 2 sport cars including Lada X-Ray Sport.

Statistics

Ernst&Young calculations show that:

  • In 2007 about 2.65 million Lada cars were sold all in all including 663.5 thousand cars AutoVAZ sold themselves. That is 6.2% more than in 2006.
  • In 2009 there were 294 737 car manufactured at the factory including 34 756 export ones with Lada Priora model prevailing – 91 thousand cars of this model were produced. Also there were manufactured 43 047 part sets.
  • In 2010 517 147 cars were sold in Russia and that showed an increase in comparison with 2009 by 48%. Also 41 577 cars were exported and 221 584 cars were sold via utilization program.
  • By 2011 26 million cars had been produced since the very first manufactured car.
  • About 57% of cars in Russia – AutoVAZ models.

Lada Granta Expos

AutoVAZ facts

  • Henry Ford Jr visited the factory in 1970.
  • Even capitalistic countries like France, Italy and England took part in the building of the factory.
  • Zhiguli name was changes into Lada for export models since the word Zhiguli reminded of Gigolo in a lot of languages, but then the name stuck with all the models.
  • Italian farmers still think Niva is the best car for their needs.
  • Lada sounds similar to Russian “Ladia” which means a certain type of ship and you can see it on the AutoVAZ logo.
  • You can still see Nivas now and then in the movies, even Hollywood ones, so there’re still a lot of them out there.

Summing up the results of the first half of 2016 operation losses made about 27.6 billion roubles thus the profits made only 87.1 billion roubles which is by 5% less that in 2015. All in all during this period 124 353 cars were sold which is by 11.6% less than in 2015.