German car-maker Mercedes-Benz and US automotive giant Ford have been added to the list of high-profile companies to pull out of Russia, following the country’s invasion of Ukraine.
Car giants Mercedes-Benz and Ford have announced they will exit Russia, joining a growing number of automotive companies to abandon the eastern European country.
In March this year, car-makers such as Ford, Mercedes-Benz, Toyota, Honda, BMW, Nissan and Renault suspended operations in Russia, due to its invasion of Ukraine.
In April, Renault sold its 68 per cent stake in Russian car-maker AvtoVAZ (parent company of Lada) for just ₽1 (1 ruble) – equivalent to $AU0.02 at the time.
Toyota – the world’s biggest car-maker by annual sales volume – sold its Saint Petersburg factory in September, announcing it would no longer import cars to Russia.
Earlier this month, Nissan offloaded its shares in its Russian division to a state-owned institute for €1 ($AU1.55).
News agency Reuters has reported Mercedes-Benz is now pulling out of Russia entirely, with the German car-giant “selling shares in its industrial and financial services subsidiaries to a local investor”.
The local investor – a car dealer chain known as Avtodom – will reportedly continue to operate at the former Mercedes-Benz production facility in Esipovo, near Moscow.
Opened in 2019, the Esipovo factory produced the E-Class sedan for the Russian market, while the ‘Sprinter Classic’ van was built in Nischni Nowgorod – six hours east of Moscow.
According to new-car sales data from Marklines, Mercedes-Benz’s passenger cars and vans divisions sold almost 45,000 vehicles in Russia last year.
Overnight, Ford announced it sold its 49 per cent stake in the ‘Ford Sollers’ joint venture in Russia for a “nominal value”, with the US car giant “retain(ing) the option to repurchase the shares within a five-year period, should the global situation change.”
As reported by Russian publication Autostat, Ford began producing the Focus for Russia in 2002 at its Vsevolozhsk factory near Saint Petersburg, with the Mondeo following in 2009.
Ford Sollers was subsequently established in 2011, handling the production, import and distribution of Ford cars in Russia.
Between 2012 and 2019, Ford’s Russian Yelabuga and Naberezhny produced passenger cars such as the Kuga, Explorer, Galaxy, S-Mac, EcoSport and Fiesta for eastern Europe.
From 2019, the Russian joint venture exclusively produced Ford’s Transit and Transit Custom commercial vehicles.
According to Marklines, Ford Sollers sold 20,840 vehicles in Russia last year, although it has managed to deliver less than 5500 examples from January to September 2022.
The announcement of Ford and Mercedes-Benz leaving Russia is not expected to affect Australian supply of new cars from either company.
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