* Premier says to increase import duties gradually
* Wants overseas carmakers to build plants in Russia
* Says very happy with new Lada Kalina Sport
(Adds Putin comments, background, detail)
By Gleb Stolyarov
MOSCOW, Aug 30 Russia will increase import
duties on foreign cars to encourage investment in local
manufacturing plants and boost domestic players, Prime Minister
Vladimir Putin told the news channel Vesti 24.
Speaking from behind the wheel of a locally produced yellow
Lada Kalina Sport, Russia's leader said he wanted
technologically advanced overseas producers to work alongside
Russian groups like Lada-maker AvtoVAZ (AVAZ.MM).
"Here's a timeline: In some years we will gradually begin to
raise the customs tariffs...But we do not want to undermine your
(foreign carmakers') business in Russia -- come to us and deploy
production here," he said while driving a leg of a 2,000 km
(1,243 miles) journey to Chita near the Chinese border.
Russia has increased import duties on new vehicles to 25
from 20 percent since early 2009 as it seeks to support local
players, many of whom were forced to the brink of collapse by
last year's financial and economic crisis.
Industry leader AvtoVAZ had to be bailed out by the state to
avoid bankruptcy last year, but has since lead a market recovery
alongside French 25 percent shareholder Renault (RENA.PA).
Germany's Daimler (DAIGn.DE) and Italy's Fiat FIA.MI have
also entered the Russian market as partners to KAMAZ (KMAZ.MM)
and Sollers (SVAV.MM), respectively, while a string of others
have opened or expanded manufacturing plants.
"We want you to gradually transfer technology skills,
increase productivity...and the level of technical training for
our specialists," Putin said, addressing foreign players.
"And for our part we will do out best to ensure a successful
launch of your business," he added.
Russia has adopted a series of initiatives to boost local
car and truck sales since the crisis, most notably a
state-sponsored scrappage scheme that rewards drivers of
10-year-old Russian cars looking to trade in for newer models.
AvtoVAZ Chief Executive Igor Komarov said last week he was
now confident enough to raise the price of a Lada from
September, while on Monday the group said it was asking staff to
work on Saturdays to support higher demand.
Putin told his Vesti 24 interviewer he was happy with the
Lada Kalina, adding that he now thought the state had done
enough to ensure Russia produces high quality cars.
"I think they (the conditions to produce high quality
domestic cars) have been established. The Lada is compact, as
you can see, not noisy. Everything works, Glonass (Russia's
navigation system) works, all systems function," he said.
However Russia's Kommersant newspaper said the vehicle had
to be replaced at one point during the journey after stones got
into the gap between the wheel and the tyre.
Overall Russia car sales rose by 45 percent in July
following a near halving of the market in 2009.
Groups such as Japan's Nissan (7201.T) and GM's Opel [GM.UL]
have predicted overall 2010 gains of up to 30 percent this year,
while 1.5 million visitors are expected at Russia's annual
international motor show. [ID:nLDE67O0B6] [ID:nLDE67P1HU]
(Writing by John Bowker; Editing by Michael Shields)