Back In The U.S.S.R? Automakers Eye Return to Russia
Back In The U.S.S.R? Automakers Eye Return to Russia: Ward’s Auto reports that Hyundai and Renault are considering a return to the Russian market, contingent on a peace deal between Russia and Ukraine following the former’s invasion of the latter. If hostilities cease, these global automakerswho previously exited due to the conflict may seek to reenter the market.
Most global OEMs withdrew from Russia after the invasion of Ukraine, leaving Russian consumers to rely on domestic automakers, Chinese car manufacturers, and the gray market for new vehicles. Some international automakers sold their Russian operations to the government or local companies with a buyback option, allowing the possibility of reentry should geopolitical conditions improve.
With the potential for a peace agreement and the lifting of U.S. sanctions, global automakers are once again assessing opportunities in what was a historically profitable market before the war. According to Ward’s Auto, Renault has not ruled out a return. Renault CEO Luca de Meo told the U.K.’s Financial Times: “I would rather focus on building the future than catching up. But we are business people. When we see an opportunity for business, we try to seize it. We have an option; let’s see how it goes.”
However, the European Union has also sanctioned Russia, and the French government continues to support these measures, which may complicate Renault’s potential return.
Back In The U.S.S.R? Automakers Eye Return to Russia
Meanwhile, Hyundai re-registered its brand name in Russia last year, signaling possible future plans. Volkswagen is also reportedly considering a return, as the struggling German auto industry seeks new opportunities to bolster growth. Yet, like France, Germany and the European Commission have imposed sanctions on Russia, making reentry a politically sensitive issue.
As for American automakers, they exited Russia well before Vladimir Putin orchestrated the invasion of Ukraine. While Russia would likely welcome them back, public opinion in the U.S. remains largely supportive of Ukraine. Any attempt by the Detroit Three to re-enter the Russian market could trigger significant consumer backlash at home.