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. Last Updated: 07/27/2016

Khristenko Says Carmaker, Foreign Player Close to Deal

The government is close to creating a new alliance between a domestic car manufacturer and a foreign player, Industry and Trade Minister Viktor Khristenko said Monday, indicating that Oleg Deripaska’s GAZ could be in line for a new partner.

Khristenko told Vesti-24 television that the government was working on a second alliance after the partnership between the country’s largest automaker AvtoVAZ and French peer Renault, although he did not name the company involved.

“Speaking about cars … we are working on a second alliance in this area, and I think it will see the light in the near future,” Khristenko said.

The enterprise has full Russian production of “hundreds of thousands” of cars, leading analysts to suggest that he must be referring to GAZ.

“GAZ produces capacity of up to 200,000 cars per year but doesn’t have the models. The Opel deal collapsed so GAZ needs a new partner,” VTB analyst Vladimir Bespalov said.

A spokesman for GAZ declined to comment.

Debt-laden GAZ had been slated to be the industrial partner of GM’s Opel had the Sberbank-backed bid for the unit not collapsed in November.

Renault agreed to buy 25 percent of AvtoVAZ for $1 billion before the global economic crisis all but wiped out the company’s sales, leaving it with heavy losses and mounting debt.

The French automaker agreed last month to provide 300 million euros ($430 million) via a technology transfer to help rescue AvtoVAZ, which is on the brink of bankruptcy. Germany’s Daimler owns 10 percent of truck maker KamAZ and is in talks to increase that stake by another 5 percent to 6 percent.