KAMAZ will consider the possibility of full SKD capacity utilization in Vietnam, according to Kommersant. In 2014, the country’s car market increased by 43%, but the Russian company is also interested in using production in Vietnam as a launch pad for exporting to other countries in the region.
During a working visit to Vietnam, a Russian governmental delegation led by Prime Minister Dmitry Medvedev held talks with Prime Minister Nguyen Tan Dung. The two countries agreed on 17 investment projects, including the industrial assembly of Russian cars in Vietnam. KAMAZ would like to take advantage of this opportunity.
Since 2006, KAMAZ has had an assembly plant in Vietnam for semi-knocked-down (SKD) kits. However, according to the company, in 2014 a total of 150 trucks were sold in Vietnam, the majority of which were imported in finished form. With such volumes, assembling vehicles in Vietnam is unprofitable. In addition, the country has high duties on finished products and vehicle kits, reaching as high as 70% for some categories of vehicles. This can be a major barrier to exports to Vietnam.