28 Apr 2022 14:12

Industry & Trade Ministry intends to coordinate with foreign automakers on operations in Russia by summer

TASHKENT/MOSCOW. April 28 (Interfax) - Plans for the further operation of foreign automakers in Russia should be clarified by the beginning of summer, Industry and Trade Minister Denis Manturov told reporters.

"We expect that within the month of May at the latest they will come to a final decision and no later than June we must come to common denominator with them," the minister said in response to a question about the further operation of foreign automakers in Russia.

"Hyundai, Kia have stocks. Avtotor is maintaining production - they are producing, just at reduced levels. Plus Hyundai in St. Petersburg is producing some volumes," Manturov said regarding the situation with production and stock of cars in Russia.

As previously reported, many foreign companies announced the suspension of local production in Russia and the cessation of imports into the country after the start of the military operation in Ukraine. Some of them cited disruptions in supply chains. Meanwhile, none of the major players have officially left Russia at the moment.

As of April, only about one-third of existing auto plants were producing cars. According to Rosstat, passenger car output collapsed 72.1% to 40,900 vehicles in March amid widespread production stoppages, a record since April 2020, when output collapsed by 79.2% to 30,000 units due to Covid-19 lockdowns.

According to the Association of European Business (AEB), the market of passenger cars and LCVs in Russia collapsed by 62.9% in March (to 55,130 units), and was down 28.4% in Q1 to 277,332 units).

In mid-April, Alexey Kalitsev, head of the AEB Automobile Manufacturers Committee, said that the association expects the Russian car market to be at least halved in 2022. "I think there will be clarity with the supply [auto parts] in the next quarter. That is, I do not expect the situation to improve significantly during Q2. The second quarter will be a period for overcoming all existing issues. And if we see a positive scenario, we will begin producing, the market this year could be somewhere between 0.8-0.85 [million cars and LCVs]. In fact, it's a drop of about 50%," Kalitsev said.