The factory was founded in 1986 as KiAZ (Kirovabad Automobile Plant) for a production of run of 30,000 "GAZelle" vans according to the project brief.

The commissioning was intended to end in 1989 but following a decision of Council of Ministers of the former USSR the construction of the factory was interrupted, and the technological project was given to the Bryansk Automobile Plant.

Construction of an automobile plant was considered by the government after the end of the Soviet Union when Azerbaijan had obtained its independence.

Since 1994 the giant and famous automobile companies of Italy, Korea, Japan, France and Germany showed interest in the facility, but negotiations held with them ended without a deal.

After Azerbaijan gained the independence, in 1993, Turkish company Otokar, showed the interest in factory but due to political change production never implemented.