Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Car Consortium to Run Lottery

The All-Russian Auto Alliance, a consortium led by Russia's largest car maker AvtoVAZ, will hold the first of a series of lotteries among its shareholders Sunday with cars and big discounts as the prizes.

Boris Berezovsky, the Alliance's general director, told a press conference Thursday that a total of 6,500 Zhiguli and Lada cars will be offered as prizes. Every 10th car will be given away for free, while others will be offered at 25- and 50-percent discounts, he said.

About 4.5 million certificates, accounting for 20 million of the alliance's shares, will be in the pot at the Sunday drawing.

The alliance began selling shares in December 1993 to raise about $1.5 billion for a factory in the Volga river town of Togliatti that would build a new generation of small Russian cars.

Berezovsky said that the alliance and U.S. auto giant General Motors should complete a feasibility study for the new plant by the end of next month. He said that the car produced at the plant would probably resemble GM's Opel Corsa model, but that the engine would be produced in Russia.

The alliance promised in December to provide 100,000 AvtoVAZ cars as prizes in a series of lotteries among its shareholders.

Valentin Yurchenko, an adviser to Berezovsky, said that Sunday's lottery was designed to reward those who bought the first issue of Alliance shares.

Many Russians still have bad memories from a Soviet-era AvtoVAZ bond issue in which the government promised each bondholder a car within two or three years. In many cases, the state refunded the bonds' face value instead of providing cars. Some bondholders received refunds as recently as last year, after inflation had already rendered the bonds nearly worthless.

But Yurchenko noted Thursday that lottery winners can claim their automobiles within three weeks after the results are announced. He said the numbers of the lucky certificates will be published in Trud newspaper two weeks from Sunday.

Yurchenko said that holders of the most expensive certificates, worth 1,000 shares each, will have best chances to win, with either a car or a discount provided for each three of such securities. The alliance in December issued 10 kinds of securities, worth 1, 3, 5, 10, 20, 50, 100, 500 and 1,000 shares.