Population’s interest in local cars shows growth
By Mirsaid Ibrahimzade
Cars of local production continue to be popular among both population and business entities.
However, the import of cars also showed growth, which can be explained by an increase in incomes of a certain part of population.
Thus, in January-February 2019, 5,169 vehicles were imported, which is 3,104 units or 2.5 times more than in January 2018, according to the State Customs Committee of Azerbaijan.
The active purchase of cars indicates confidence in the further improvement of population's well-being. This is evidenced by the fact that in the two months of 2019, 4,707 cars were imported to the country, that is 2,840 units more compared to the same period last year.
Chairman of the Board of Azermash OJSC Emin Akhundov said that about 1,000 cars were sold in 2018, but according to the results of only two months of 2019, 500 vehicles have already been sold. At the same time, if last year 40 percent fell on purchases by government agencies and 60 percent - by the population, now this ratio has changed. This year only 15 percent account for the state structure while 85 percent falls in the share of the population.
A joint venture between Khazar OJSC Azermash and Iran Khodro, commissioned in Neftchala industrial park on March 29, 2018, cost $15 million (75 percent is Azermash’s share and 25 percent is Iran Khodro’s share).
The plant has 300 employees and capable to collect up to 10,000 cars per year. At the same time, if necessary, it is possible to switch to a three-shift operation, and without additional space, bring the assembly volumes to 30,000 cars a year.
It is worth noting that due to import substitution policy in automotive industry, the foundation of the automobile plant was laid in the Hajigabul industrial quarter on February 9, where a line of 12 types of Russian trucks of the GAZ Group will be assembled, scheduled for release in the second half of 2020. The estimated investment in the new automobile plant in the Hajigabul industrial quarter will be 14 million manats (over $ 8 million). Some 100 people will work at the plant owned by Azermash, and the assembly volume can reach up to 1,000 cars a year.
The relevance of the construction of a truck production plant is confirmed by import figures in January-February of this year. Thus, Azerbaijan imported 397 trucks, which is 215 units or two times more compared to the same period of last year.
Generally, cars, trailers and semi-trailers were produced in the country worth 106.6 million manats according to the results of 2018, which is 31 times higher compared to 2017. As many as 969 cars were produced in 2018, which is 32.4 times more than in 2017.
So, in order to reduce the capital outflow, new agreements were reached with Iranian companies Qartal - on the construction of a Scania bus factory in Azerbaijan (in the Hajigabul industrial quarter), and Etihad - on the construction of a car parts factory (in the Neftchala industrial park) together with Azermash.
In the meantime, business expenses for the import of vehicles and spare parts for them have increased. Thus, in January-February 2019, $ 103.35 million was sent to import vehicles and spare parts, which is $ 48.447 million or almost twice the cost of importers in the first two months of 2018. As a result, the share of expenditures of the population and business on transport in the country's total imports increased from 3.78 percent to 4.77 percent.
In addition, the Nakhchivan facility opened in 2010 assembles eight models of Lifan passenger cars designed by China’s Lifan Group, which provides all the necessary spare parts for cars to the plant so they may be assembled in Azerbaijan under the direct supervision of Chinese automotive specialists.
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