Under pressure, the French manufacturer suspends any industrial activity in Russia and seeks a way to disengage from the country by limiting the case. This decision could, however, cost him a few billion euros.
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The pressure had become too strong and do the big back against the Russian invasion in Ukraine was no longer a tenable position. The Renault Group – the world-sized car manufacturer most implanted in the country of Vladimir Putin – announced, Wednesday, March 23 in the evening, the suspension of its industrial activity in Russia in a short press release which followed an extraordinary meeting of its Board of Directors.
This is a shock and major ad for the French company because Renault now opens the door to a definitive departure from Russia. This market is one of the most important for Renault, more precisely its second country after France in terms of vehicle sales (almost 500,000 registrations in 2021). The Losange has its own activities – a factory in the capital – and, above all, it is the owner (at 67.7%) of the historic AVTOVAZ manufacturer (LADA brand). In total, Russia is no less than half of the operating income of the Renault Automotive Division.
Russia, second market after France
First, for its own brand, “The activities of the Renault factory of Moscow are suspended from that day,” says the French manufacturer in his communiqué. The Moscovite site, which had been arrested since February 29 for lack of supply, had taken over in the last three days after a lot of pieces had reached the factory. “The company has finished the cars that were being manufactured, it emptied the lines, then everything closed”, details a good connoisseur of the company.
With regard to the fate of the actual activities, the situation is much more complicated. “The group evaluates the possible options for its participation in Avtovaz, while acting responsibly for its 45,000 employees in Russia,” says Renault. It is not clearly said, but the tricolor group seems to look for a definitive exit door. Except that, according to an internal source, there is a dead end: “to separate from Renault’s participation in AVTOVAZ is a puzzle: Financial transactions with Russia are prohibited but it is not a question of letting go the company For nothing after all we have undertaken. “
It was in 2008 that, sponsored by Vladimir Putin and Carlos Ghosn, Renault enters the capital of the Russian manufacturer. First at 20%, to gradually achieve two-thirds of the Units. The diamond invested nearly 2 billion euros in the ex-Soviet company. It has modernized the two industrial sites (Izhevsk and the Giant Togliatti plant, which employs 35,000 people), it has rejuvenated and modernized the range, it has streamlined the industrial processes, bringing the know-how and the organization of the Renault-Nissan-Mitsubishi Alliance. The former kombinat became profitable from 2017, while arrogating a 28% market share.
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