Bogdan’s car production rises 40% y-o-y in 2010

Bogdan Corporation increased passenger car production by 40% y-o-y in 2010 to 20.1 ths, the company reported yesterday via Interfax. Yegor Samusenko: The company’s production increase was higher than that of other producers: we estimate aggregate domestic car production growth at 5% in 2010. Bogdan Motors (UX: LUAZ UK), which assembles all passenger cars in Bogdan Corporation, achieved the growth mainly thanks to the opening of CIS export markets. In the upcoming year, we expect output growth to be driven by a recovery in domestic demand on the back of an increase in disposable income, renewal of consumer lending and rise in consumer confidence. Notably, the company assembled almost 3 ths cars in December, while its monthly output since late 2008 has not exceeded 2 ths cars per month, which we believe is indicative of the company’s confidence in the revival of demand for new cars. We anticipate Bogdan Motors to increase car production by 30% in 2011.