In Ukraine, the workshops of the LuAZ and Bogdan automobile plants, automotive assets owned by the ex-president of Ukraine Petro Poroshenko, were put up for auction. The factories that produced the iconic Soviet SUV Luazik and VAZ-2110 could not find a client at home and abroad. In Ukraine, the property of the automobile company Bogdan Motors was put up for auction - production workshops of automobile plants in Lutsk (LuAZ) and Cherkassy (Bogdan). Information about the auction is posted on the Prozorro Sale site, which is managed by the Ministry of Economy of Ukraine. Land plots, workshops, including the main production building and the electrical workshop of the plant in Cherkasy, warehouses, laboratories and other production facilities will be put under the hammer. The initial price of the lot is 76.2 million hryvnia ($2.7 million), the auction will be held in two weeks - on March 3, 2022.

From 2009 to 2014, licensed Russian VAZ-2110 models and VAZ-2111 station wagons were produced at the production site in Cherkasy from 2009 to 2014 under the Bogdan brand. And the plant in Lutsk in Soviet times produced SUVs "LuAZ-969" "Volyn", this model was quite common in the Soviet Union; In the early 2000s, the assembly of UAZ and VAZ vehicles was launched at the plant in Lutsk. Since 2006, the company has refocused on the production of buses.

In July 2021, Bogdan-Motors was declared bankrupt by the decision of the Economic Court of the Dnipropetrovsk Region.

The company's debt to creditors is about 6.7 billion hryvnia ($240 million), TASS reported. Until 2009, the owner of the company was Petro Poroshenko (President of Ukraine in 2014-2019), who, according to Ukrainian media, sold a stake in the company to his business partner Oleg Svinarchuk (Gladkovsky). However, according to the Ukrainian publication Insider in 2014, Poroshenko, through an extensive chain of companies, still retained control over these automotive assets.

Assets that are not directly involved in production are sold through the auction, said Oleg Omelnitsky, general director of the Ukrainian information and analytical group AUTO-Consulting, who is familiar with the situation. According to him, we are talking about the workshops of the plant, which were supposed to expand the production of cars and buses, but they were never modernized.

“At the Lutsk plant, buses and trolleybuses are now being assembled. However, their production volumes are minimal: last year they produced about 100 pieces, although the enterprise is designed to produce 4.5 thousand pieces per year, ”the source said.

In Cherkassy, ​​a building was put up for auction, in which it was planned to organize the assembly of Hyundai cars in 2010, he said. These plans, as well as attempts to start production of Chinese JAC cars at the plant in 2013, also failed, Omelnitsky added.

According to him,

The sale at auction of workshops where cars "VAZ-2110" and "VAZ-2111" were let in is a matter of time. The production of cars in Cherkasy was stopped in 2014 and this car plant has no development prospects.

Financial problems at Bogdan Motors began at the turn of 2009-2010 - after the company took loans in the amount of $330 million for the development of production. After a sharp fall in the hryvnia exchange rate, the company was unable to meet its obligations, the expert recalled.

“Under the presidency of Poroshenko, these loans issued by state-owned banks were restructured for 15-20 years at minimal interest. However, the new authorities in 2019 initiated a review of the legality of this procedure.

The deal was recognized as non-market and concluded to the detriment of the interests of state banks. As a result, bankruptcy proceedings began at the company,” said Oleg Omelnitsky.

Almost all enterprises of the Ukrainian automobile industry went through bankruptcy, he emphasizes. The difficulties that the Ukrainian auto industry is experiencing are related to the small volume of the domestic market and the difficulties in exporting locally produced cars.

“The Russian and Belarusian markets are closed for obvious reasons. Consumption volumes in Armenia, Georgia and Azerbaijan are also not the largest. In Europe, there are more stringent technical requirements for cars,” the interlocutor sums up.

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Fruit of Conversion

The LuAZ 969 was the most affordable off-road vehicle in the USSR, recalls automotive historian Dmitry Fedorov. According to him, in the late 80s, this model cost 5.1 thousand rubles.

“Initially, the car, which was called the LuAZ 967, was designed for the military as a light front-line transporter. His main task in the event of hostilities was the evacuation of the wounded from the front line and the supply of ammunition,

- said in an interview with Fedorov.To reduce the cost of the car, it was decided to make a civilian SUV based on a military transporter. The serial "LuAZ 969" has been produced since 1970, the car was very popular among the inhabitants of the countryside.

According to Alexander Kovrigin, Deputy General Director of ASM-Holding, the Lutsk Automobile Plant did not play a significant role in the overall structure of the Soviet automobile industry, so it cannot be correlated with such significant enterprises as, for example, KrAZ or ZAZ.

“The production volumes of the LuAZ car during the Soviet era were relatively small,” Kovrigin noted.

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