A few days ago, the CEO of AvtoVAZ, Russia's largest car company, said that due to the deterioration of the situation, it is seeking alternative supplies of electronic chips to cope with the upcoming Western chip sanctions and supply chain crisis.
Pictured: Lada's automotive production line in 2022
AvtoVAZ is not only the largest car company in Russia, its predecessor "Volga Automobile Factory" and its Lada brand car countrymen are very familiar.
In addition, France's Renault, the holding company of AvtoVAZ, also said that "there may be another supply chain crisis related to parts that must come from abroad." In addition to the two AvtoVAZ plants, Renault's plant in Moscow may also face chip and component supply constraints.
At the same time, Renault boss De Mayo publicly stated that it does not rule out the suspension of production due to the Crisis in Ukraine, or even the complete closure of Russian factories. About 20 percent of the parts at the AvtoVAZ plant rely on imports, compared to nearly 40 percent at the Renault plant in Moscow. Industry observers say Russia lacks its own chip production, with 90 percent of chips dependent on global supplies, including China.
"We are looking at it piece by piece, if it comes from China, it will be different from Germany or the United States", which seems to mean that Russian car manufacturers are turning their attention to Chinese chip and auto parts suppliers.
Pictured: Japan said it would join the U.S. sanctions on Russian chips
At the same time, the United States, Japan and Europe include the world's major automotive chip IDM and Tier1, while Russia is currently more dependent on the import of vehicles from Chinese brands, and in theory, Chinese chip and parts suppliers cannot effectively solve the problem of "substitution".
After Russia announced its recognition of the independence of the two regions, the Western government announced the imposition of new sanctions on Russia. The White House told its chip industry to prepare for new restrictions on Russian exports, while Japan said it would follow up with U.S. chip and technology sanctions, mainly for high-tech products used in semiconductors, artificial intelligence, robotics and so on.
And if the EU follows suit, it means that Russia will not only lose its main source of chip imports, but also suffer a serious blow to the already severe supply of automotive chips.
Pictured: The first choice of "10,000 yuan households" in the 80s - Lada 2105
Back in the last century, the Volga Automobile Plant (VAZ) was founded in 1966 and produced 750,000 vehicles a year in 1975, making it the largest depot in Russia and even In Eastern Europe. Throughout the 1970s and 1980s, VAZ's brands gained great popularity in the Soviet Union, Eastern European countries and China, and became a symbol of urban life at that time.
Among them, the mainland introduced the Lada 2105 model in batches and used it as a Beijing taxi, which became the first choice of "10,000 yuan households" as a status symbol in the early days of reform and opening up.
Subsequently, due to the collapse of the Soviet Union and other factors, Lada Automobile gradually declined, and after the joint-stock system transformation and the introduction of international capital, 90% of the current market came from the mainland.
Looking back at history, the Russian cars represented by Lada Motors have gone from "flourishing" to "disappearing" to finally privatizing and being sold to the Renault Group, which is also directly related to the severe technical sanctions imposed by the United States and other Western countries on the Soviet Union during the Cold War.
This time, can the "ill-fated" Rada pass the pass smoothly?