French automaker Renault will have to pay up to $1.3 billion to Russia if it wants to regain its factory and continue doing business in the country.
According to Carscoops, if Renault wants to re-enter the Russian market and resume operations, it will have to pay a substantial amount, estimated at 112.5 billion rubles, or $1.3 billion at the current exchange rate. This figure was confirmed by Maxim Sokolov, CEO of AvtoVAZ, in a statement to the Russian press.
Sokolov argued that Renault needs to compensate for the investments made by the Russian side during the company’s absence, emphasizing that AvtoVAZ’s current investment far exceeds the 20-22 billion rubles per year that Renault spent before its withdrawal.
Renault was once one of the most influential foreign car manufacturers in Russia. The French automotive brand exited the market in 2022 following the escalation of the Russia-Ukraine dispute.
Upon its departure, Renault sold a 68% stake in AvtoVAZ, Russia’s largest car manufacturer, to the country’s NAMI automotive research institute for a symbolic price of one ruble (approximately $0.01). The agreement included a clause allowing Renault to buy back the shares within six years if circumstances changed. Additionally, Renault’s Moscow production facility was transferred to the local government. According to Renault’s 2022 financial report, the decision to leave Russia resulted in a loss of up to €2.2 billion ($2.29 billion).
Renault’s exit from Russia was part of a broader trend of Western companies divesting from the country following the Russia-Ukraine conflict. However, with recent signs of potential peace negotiations between the two countries, facilitated by the US, businesses are beginning to reconsider their presence in Russia.
Nonetheless, Renault remains cautious. In a recent statement, the company said the likelihood of returning to Russia under the 2022 terms is “very, very low.” A Renault spokesperson declined to comment further on the $1.3 billion figure mentioned by AvtoVAZ.
Following Renault’s sale of its stake, the company’s assets were transferred to Russian state ownership. Just a few months later, the Renault factory in Moscow resumed production under the Moskvich brand, a former Soviet-era icon.
Prior to 2022, Renault controlled approximately 30% of the Russian car market through AvtoVAZ, with the Lada brand dominating sales. After Renault’s exit, Chinese automakers witnessed a significant growth in market share. Currently, Chinese carmakers account for over 50% of new car sales in Russia, a substantial increase from the pre-2022 figure of less than 10%. AvtoVAZ has also made an impressive recovery, selling nearly 460,000 Lada vehicles in 2024, a 30.2% increase from the previous year, and double the number sold in 2022.
Thai Son (Tuoitrethudo)
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