After Renault announced its exit from the Russian auto market this week, here’s what’s happening
“The foreign owner has decided to close the Renault plant in Moscow. He has the right to do so, but we cannot allow thousands of workers to be unemployed ”. This is the announcement of the mayor of Moscow, Sergei Sobyanin. Here is what is happening in Russia.
Indeed, Renault has decided to leave Russia. We do not know whether the global geopolitical situation weighed on this decision by the French carmaker. In fact, on February 24, Vladimir Putin’s Russia decided to invade neighboring Ukraine. Since that time, now over three months of death and devastation.
But also of economic consequences. Not only with regard to the energy crisis. But also that of wheat. And, then, the increases in gasoline and diesel that we have seen and suffered in recent weeks. In short, the conflict in Ukraine is bringing with it very serious consequences also from an economic point of view.
The sanctions imposed on the Russian oligarchs are now known. Empires of billions and billions confiscated in retaliation from Europe and the United States for the invasion policy of Moscow. But also important brands, from any sector, which have decided to leave Russia. Including Renault. But the farewell of the French carmaker could open the doors to a sensational return.
The return of the colossus of the Soviet Union
After Renault announced its exit from the Russian auto market this week, the mayor of Moscow has announced that the factory will be used to restart the Moskvich car brand which dates back to the Soviet era.
Little known outside the former Soviet Union and its satellite countries, Moskvich was founded around 1930 and operated until 1991, but has always had quality problems.. However, this did not prevent the Soviet government from entering into an agreement with Renault to modernize the factory. According to the specialized agency Autostat, there are nearly 200,000 Moskvich cars still registered in Russia, of which 46,000 are over 35 years of age. Production ended when the Soviet Union broke up and Western carmakers, such as Renault, moved there.
Part of the former Moskvich factory reopened in 2005 as a joint venture between Renault and Moscow. Now the mayor of Moscow, Sergei Sobyanin, wants to revive the Great Mother Russia: “I made the decision to register the plant as a city resource and resume the production of cars with the historic Moskvich brand. In 2022, we are turning a new page in Moskvich’s history, ”Sobyanin added.
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