Renault left Russia and gave the Lada for less than a penny

A month and days after suspending its industrial activity, Renault decided to leave Russia. And with its escape plan, the French group arranged the departure Lada for the symbolic sum of one ruble; meaning, less than a penny.

It is realized that its exit from the Russian market will cause huge losses, and one of the biggest questions lies in the future of AvtoVAZ (Lada), in which the French group owns 68% of the sharing and appreciating with $ 3.1 billion.

According to Russia’s Minister of Commerce and Industry, Denís Mánturov, Russia’s famous brand -the number one in that country- will be controlled by state automotive research institute NAMIwith the option to repurchase the French brand over the next five or six years.

Chronicle of an announced escape

From the beginning of Russia’s invasion of Ukraine, Renault was one of many brands expecting revenge against Vladimir Putin’s administration. This, added to the lack of components for the manufacture of vehicles, “helped” his departure to be easy.

Manturov explained that due to lack of resources to maintain production, the French group decided to dispose of its shareholding in AvtoVAZlargest manufacturer, and factory of Russia and Eastern Europe Avtoframosformerly Renault Rossia.

The Russian company, which has a staff of 45,000 employees in that country, it would be controlled by the Moscow government. And although there is an option to a repurchase in the future, from the government they indicated that a new move into the hands of the French would cost more than a ruble.

“If we make investments during this time, they will be included in the price. There are no freebies here,” Manturov said.

“None of our plans are buying, let alone nationalizing. But if the companies cannot guarantee the supply of components, we cannot wait indefinitely. We will be forced to look for alternatives,” the official warned.

To date, Renault has produced local versions of the Captur and Arkana SUVs, as well as the Nissan Pathfinder, in Moscow. While Lada, which owns two factories, in 2021 will sell more than 385,000 vehicles, allowing the French group’s total sales in that country to reach approximately 500,000 vehicles.

EFE

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