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Russia's Avtovaz to make new car models after Renault suspends Moscow plant

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By Reuters
Russia's Avtovaz to make new car models after Renault suspends Moscow plant
Russia's Avtovaz to make new car models after Renault suspends Moscow plant   -   Copyright  Thomson Reuters 2022

-Top Russian carmaker Avtovaz said on Thursday it would manufacture new models with reduced exposure to imported components and do its best to restore supply chains, a day after Renault said it was suspending its Moscow factory.

Avtovaz, controlled by French carmaker Renault, said it had done all it could to save the jobs of 40,800 employees and that it aimed to meet all of its obligations, including export contracts.

“Active work is underway to substitute some critical imported components with alternative solutions,” Avtovaz said in a statement, without naming the components.

“The company is also preparing special versions of some LADA models with reduced exposure to imported components. These will be available to our customers in the coming months,” it said.

Avtovaz partially halted production at its plants in Togliatti and Izhevsk earlier this month over shortages of electronic parts and was forced to bring forward its corporate vacation in order to stockpile more components.

Renault’s decision to suspend its Moscow factory came amid mounting pressure over the French company’s continued presence in Russia since Moscow sent troops into Ukraine on Feb. 24.

Ukrainian President Volodymyr Zelenskiy on Wednesday urged Renault and other French firms to quit the Russian market, and Ukraine’s foreign minister, Dmytro Kuleba, has called for a global boycott of Renault.

Renault derives 8% of its core earnings from Russia, according to Citibank, mainly through its 69% stake in Avtovaz, which owns the Lada car brand.