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. Last Updated: 07/27/2016

Kaliningrad Plasma TV Plant Could Cut Prices

Electronic giant Samsung is to start production of plasma television sets in the Kaliningrad region, a step that will likely bring down prices for Russian consumers, Kommersant reported Monday.

The South Korean firm will begin production at the Telebalt factory in Kaliningrad in July, Kommersant said, producing several thousand sets monthly.

Samsung spokesman Vladimir Romantsov declined to confirm the report, however, saying he was not authorized to make "any comment regarding Kaliningrad."

Plasma television sets are a ubiquitous sight in the country's electronic retailers, but still cost well more than $1,000, putting them out of reach for many Russians.

The Telebalt factory has capacity to churn out up to 5 million television sets annually, raising expectations that the Samsung sets could bring down prices.

"The price must be ridiculously low to persuade Russian consumers to buy made-in-Russia electronics," said Yelena Bazhenova, analyst with MDM Bank. "Russians have a traditional pride in buying foreign-made goods even if they are very expensive."

Bazhenova said the experience of Sitronics, the country's largest electronics manufacturer, was a classic example.

"Sitronics tried many times to grab market share with Russian-made flat screen televisions, but it just didn't work," Bazhenova said.

Bazhenova also said competing with labor costs in Asia, where most electronic goods sold in the country are made, would be difficult.

Vasily Motchar, deputy director at consultancy ITResearch, said the market for flat screen televisions was highly saturated, prompting major manufacturers to look to shift their assembly operations to Russia.