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Business news, 14.06.2011 20:09

Yo! Russian billionaire launches production of minicars

Yo Mobil

Russian car industry may revive with a fresh impetus of new minicars - known as Yo Mobil - to be produced in Russia under the guidance and inspiration of Mikhail Prokhorov.
June 8, at the Maryino industrial park nearby St.Petersburg, Prokhorov launched the construction of a new hybrid manufacturing plant.
First Russian hybrid will come to light in second half of 2012, however there is a pre-order option on the website that currently registers about 120,000 applications from potential buyers. Notably, the speaker of the Murmansk regional Duma, Evgeny Nikora, is also on the application list. - I've pre-ordered Yo Mobil, I'm 54,045 by number, he tweeted recently.
- You do not need to spend billions of dollars to compete on the market, says Mikhail Prokhorov, a number three on the Forbes' list of the richest people in Russia. It is enough to trigger the potential of our people. The unique features of the car are in 20 solutions that were developed by Russian engineers. This is what makes the car unique, he said.
Yo Mobil may run on both petrol and gas. Besides, the car may get charged with electrical energy from an ordinary socket. First line of Yo Mobils will be commissioned in late 2012. On the initial stage, the plant is expected to produce about 20,000 cars a year; further plans for production output reach out for 100,000 hybrids annually. 90% of all the cars' components are to be produced in Russia.
Depending on the vehicle configuration, the price varies from 360,000 to 490,000 RUB (8,900-12,100 EUR).
- Our company is opened for foreign investors, says Andrey Biryukov, a director general of Yo Auto. Yo Auto and Onexim have invested 150 mln EUR. On the next stage of the project development, we do not exclude the fact that we may need extra funds. The payback period is believed to be 3-5 years.
Yo Auto, the plant-to-be, is owned by Yarovit (51%) and Onexim [investment group founded by Prokhorov] (49%). Yarovit Motors is deploying its production facilities nearby Yo Auto in 2012; the company is to produce heavy trucks with an investment plan of about 2.3 billion EUR.
Meanwhile, one of the largest light vehicle producers in Russia - Avtovaz - does not prove to be viable on the market. During the crisis period of 2009, the plant dropped its production output by 2,7 times as compared to 2008. After investing billions of rubles into the death-marked car producer, Russian Government went further to introduce two major promotional programmes to boost sales of Russian cars: lower interest rate for car loans, and the so-called 'recycling programme' aiming to offer a 50,000 RUB discount to a buyer upon the exchange of an old car for a new one. So far, the recycling programme allowed Avtovaz to sell over 300,000 cars. In 2011, the Government is phasing out of the support programmes leaving behind vague prospectives for future development of the car manufacturer. Another nail in the coffin of Avtovaz has come this week with police and FSB investigations that revealed misappropriation of about 1 bln RUB by a few managers of the company.
In expectation of the Yo's commercial success, Prokhorov still claims that he marches out of his business for the sake of politics. The billionaire expects to become a leader of the new-born political party - 'Pravoye Delo' ('Right Thing', established in late 2008 as a result of a merge of three other parties) and enter the State Duma. The election session of the Pravoye Delo to consider Prokhorov for the leader's position is dated to June 25.
Etymologically, "Yo" stands for a Russian letter that was one of the latest to enter the Russian alphabet. As underlined by Valentina Matvienko, the governor of St.Petersburg, this innovative letter was born in Academy of Science located in St.Petersburg and that might be a lucky sign for Yo Mobil that is to be produced in the neighbourhood of the city.

News source: Barentsnova

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