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Russia wants in on the luxury auto boom

Luxury auto sales are booming in resource-rich nations like Russia, and Russia would like to get in on the action with its own luxury brands.

By Viknesh VijayenthiranGuest blogger / February 17, 2013

A cleaner mops the floor at a Lexus car showroom in Russia's Siberian city of Krasnoyarsk last week. Luxury auto sales are booming in many parts of the world, including Russia, and the nation would like to capitalize with upmarket brands of its own.

Ilya Naymushin/Reuters/File

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With luxury auto sales booming in many parts of the world, especially in resource-rich nations like Russia, where sales of Audis, BMWs and Mercedes-Benzes continue to soar, some of the local automakers are considering entering the segment with their own upmarket vehicles.

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In Russia, the push is coming from country’s own government, which reportedly is seeking a domestic luxury auto brand to challenge the popular Western rivals.

Automotive News (subscription required), citing Russian newspaper Rossiiskaya Gazeta, is reporting that Russian industry and trade minister Denis Manturov has asked local automakers like GAZ, ZiL and even niche sports car manufacturer and Formula One contender Marussia to develop proposals for a new luxury brand.

To help kickstart the project, Manturov is reportedly promising state support.

Some of the automakers, including Marussia, have confirmed they are working on the proposal.

ZiL already builds armored limousines for the Russian government and, given its size, could easily expand into building more mainstream cars. The same would be true for GAZ.

Marussia, on the other hand, would need to expand considerably to become a volume manufacturer of luxury cars. It currently sells a handful of sports cars per year and is working on a new model, the B2, which is pictured above in concept form and has been spied testing in prototype form recently.

Of course, establishing a new luxury brand is not something done overnight. It takes years of brand development, and vehicles with the high levels of performance, refinement and quality that luxury buyers demand--something we’re yet to see from Russian automakers.

One possibility that could be popular is reviving GAZ’s Volga brand. It was a symbol of high status during the Soviet times, though the brand has been tarnished recently with GAZ resorting to using old Chrysler platforms, like that of the Sebring, to underpin its latest Volga models.

 

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