Ford and Benz Officially Announce Withdrawal from Russia

(Photo by BBC)

[Asia Economy Reporter Yujin Cho] Ford and Mercedes-Benz, which had suspended operations at their factories in Russia following the Ukraine crisis, are withdrawing from their Russian businesses.

According to the Wall Street Journal (WSJ) on the 26th (local time), Ford announced in its Q3 earnings report that it had sold its 49% stake in the Russian joint venture Ford Sollers. Ford stated that it had finalized the sale agreement and completed the transaction but did not disclose the exact sale price.

The company said, "The sale includes an option to repurchase the stake within five years through a call option if the global situation changes."

Ford had suspended operations at its Russian factory since March, following Russia's invasion of Ukraine. Ford established production facilities in Russia in 2011 and had focused on manufacturing and selling commercial vans.

Mercedes-Benz also announced on the same day that it would sell its subsidiary stake to AvtoVAZ, Russia's largest automobile manufacturer. The sale includes the factory located in Moscow. Mercedes-Benz stated, "Russian authorities are currently reviewing the approval of the transaction."

Avtodrom is Mercedes-Benz's local dealer in Russia and will be responsible for after-sales support services following Mercedes-Benz's withdrawal. Natalia Koroleva of Mercedes-Benz Russia said, "We will provide after-sales support and financial services to Russian customers and maintain jobs for employees of the Russian subsidiary."

Harald Wilhelm, Mercedes-Benz's Chief Financial Officer (CFO), formalizing the withdrawal from Russia, said, "We do not expect this withdrawal to have a serious impact on the company's profits."

Prior to Ford and Mercedes-Benz, Japanese automaker Nissan and French automaker Renault also left Russia earlier this month. Nissan sold its factories and research facilities in Russia to a Russian state-owned company for 1 euro. The nationalized Nissan factory is planned to be operated as a joint venture with Russian automaker Kamaz and a Chinese company.

Renault also sold its local factory stake to the Russian state-owned automotive development research institute and the city of Moscow for 2 rubles, with a condition to repurchase at the same price within six years.

This content was produced with the assistance of AI translation services.