Amid Moscow’s invasion of Ukraine and foreign company’s withdrawal method of the country, Renault, the French carmaker, has sold off its Russian assets to the Russian government. Thanks to the military invasion of Russia in Ukraine, Renault had a 68% stake within the largest carmaker in Russia, AvtoVAZ, with Lada, the highest brand within the country.
Nearly half 1,000,000 vehicles were sold in Russia which was the second largest marketplace for Renault, behind Europe. The ministry in a very statement noted that for the transfer of assets that the Renault Group held in Russia, agreements were signed. As per the terms of the agreement, Renault should purchase the stake in AvtoVAZ with a six-year option.
The Moscow plant of Renault was also included within the deal. French carmaker Renault has sold its Russian assets to the Russian government, both parties announced on Monday, as foreign companies leave the country amid Moscow’s military operation in Ukraine. Renault controlled 68% of AvtoVAZ, the most important carmaker in Russia with the country’s top brand Lada, but was stressed to tug out of the country since Russia’s military intervention in Ukraine.
Thanks to AvtoVAZ, Russia was Renault Group’s second-largest market behind Europe last year, with around half 1,000,000 vehicles sold. Luca de Meo, the chief executive of Renault, mentioned in an exceedingly statement: “We have selected a difficult yet important matter as we shall make a responsible and fair choice towards the 45,000 employees that we’ve got in Russia, at the identical time conserving the performance of the Group and also the possibility people returning to the country in future in numerous circumstances.” Sergei Sobyanin, the Moscow mayor, said that Renault has decided to shut its plant in Moscow; however, it cannot permit thousands of workers to be left with no work.
He also informed his decision to recommence the passenger cars production under Moskvich, the Soviet-era brand. Renault has faced difficulties in its operations since the Russian invasion of Ukraine thanks to the scarcity of components after the curbs because of Western sanctions. It’s also faced pressure from the Ukrainian authorities who caught up the prohibition of its vehicles until it stops operations in Russia.