Western Carmakers Find Returning to Russia Unfeasible, Says Top Official
A high-ranking official has indicated that Western car brands that exited Russia in 2022 are improbable to make a comeback, even though they have kept their buyback options. Read Full Article at RT.com
TroibNews 
In 2022, numerous brands chose to incorporate a buyback option when selling their assets.
Western automakers that exited the Russian market amid the Ukraine conflict face significant hurdles in returning, even with buyback clauses in place, according to First Deputy Prime Minister Denis Manturov.
Renowned companies such as Germany’s Mercedes, France’s Renault, and Japan’s Nissan departed from Russia in 2022 following an extensive sanctions campaign initiated by the US, the EU, and other nations against Moscow. Although these companies sold their assets to Russian firms or transferred them to the government, the contracts included clauses allowing for potential future buybacks.
Nonetheless, Manturov expressed that these brands may find it challenging to return since their vacancies have already been filled by other manufacturers. He indicated skepticism regarding the feasibility of a comeback for these companies, noting, “The carmakers simply ran away, slamming the door. Yes, they do have buyback options but I very much doubt that a return is realistic and feasible. The [firms] that have replaced them have offered… much more favorable terms.” His comments were made in an interview featured in Vedomosti newspaper on Tuesday.
Manturov’s remarks followed the recent Eastern Economic Forum in Vladivostok, which welcomed high-profile delegations from countries such as China and India.
In recent years, China has emerged as the largest foreign supplier of automobiles to Russia. Brands such as Chery, Haval, Geely, Changan, Exeed, and Omoda have entered the Russian market, effectively taking the place of previous European, Japanese, and Korean manufacturers. Forbes magazine has identified Chery as the largest foreign company operating in Russia by revenue for 2023. According to the analytics agency Autostat, Chery ranked as the second-best-selling car brand in Russia last year, capturing an 11% market share, just behind the Russian Lada.
Historically, European carmakers dominated the Forbes rankings, with Volkswagen Group leading in 2022 and Renault being at the top in 2020.
In a related note, some foreign manufacturers, including Japan’s Toyota and Germany’s Volkswagen, exited Russia without retaining a buyback option.
Debra A Smith contributed to this report for TROIB News
Western automakers that exited the Russian market amid the Ukraine conflict face significant hurdles in returning, even with buyback clauses in place, according to First Deputy Prime Minister Denis Manturov.
Renowned companies such as Germany’s Mercedes, France’s Renault, and Japan’s Nissan departed from Russia in 2022 following an extensive sanctions campaign initiated by the US, the EU, and other nations against Moscow. Although these companies sold their assets to Russian firms or transferred them to the government, the contracts included clauses allowing for potential future buybacks.
Nonetheless, Manturov expressed that these brands may find it challenging to return since their vacancies have already been filled by other manufacturers. He indicated skepticism regarding the feasibility of a comeback for these companies, noting, “The carmakers simply ran away, slamming the door. Yes, they do have buyback options but I very much doubt that a return is realistic and feasible. The [firms] that have replaced them have offered… much more favorable terms.” His comments were made in an interview featured in Vedomosti newspaper on Tuesday.
Manturov’s remarks followed the recent Eastern Economic Forum in Vladivostok, which welcomed high-profile delegations from countries such as China and India.
In recent years, China has emerged as the largest foreign supplier of automobiles to Russia. Brands such as Chery, Haval, Geely, Changan, Exeed, and Omoda have entered the Russian market, effectively taking the place of previous European, Japanese, and Korean manufacturers. Forbes magazine has identified Chery as the largest foreign company operating in Russia by revenue for 2023. According to the analytics agency Autostat, Chery ranked as the second-best-selling car brand in Russia last year, capturing an 11% market share, just behind the Russian Lada.
Historically, European carmakers dominated the Forbes rankings, with Volkswagen Group leading in 2022 and Renault being at the top in 2020.
In a related note, some foreign manufacturers, including Japan’s Toyota and Germany’s Volkswagen, exited Russia without retaining a buyback option.
Debra A Smith contributed to this report for TROIB News
