The president of Uzbekistan Islam Karimov signed a decree to free state company Uzavtoprom’s joint venture with US car maker General Motors Corp. from taxes for five years. The joint venture was planned last year and is based on existing car plant in Asaka, Uzbekistan, and it is planned to annually produce 250,000 Chevrolet cars.

Uzavtorpom has been looking for a potential partner since the South Korean Daewoo Motor, established in Asaka in 1996, went bankrupt in late 90s and left Uzbekistan. The car kept functioning even after the South Korean company left it. It has been producing a diverse range of cars - Damas, Nexia, Tico, Matiz, Lacetti.

For a great part of population of the country a car is still considered to be an unattainable luxury. The reason is that the cars produced in Uzbekistan are more expensive inside the country then the same ones exported abroad. In neighboring Kyrgyzstan, one can buy a used Nexia in a very good condition for about 5,000 USD. Whereas in Uzbekistan the same car is sold for no less then 10,000 USD. You may ask a question - why not to buy a car in Kyrgyzstan and get it into Uzbekistan? The problem is that in Uzbekistan the custom taxes for imported cars is very high, almost 100% of the car price. Therefore, if you travel to Uzbekistan, you rarely see imported Western or Japanese cars. All you see is either very old Soviet made Volga, Lada or Moskvich or unreasonably expensive cars made in local (!) Asaka car plant.

Lets hope that with tax breaks and the world famous GMC the policy of Uzavtoprom will change to a more customer oriented marketing.