Japanese carmaker Toyota to leave Russia

TOKYO Kyodo Motor Corp. has decided to leave Russian auto production, saying it sees no possibility of resuming already suspended output as supplies of key materials are disrupted seven months into Moscow's war against Ukraine.

Toyota, which halted operations at its plant in St. Petersburg in March due to supply chain issues, is the first major Japanese automaker to announce its withdrawal from vehicle manufacturing in Russia.

Nissan Motor Co., another Japanese automaker, has extended its suspension of its plant in St. Petersburg for three months until December 31st. The plant was due to resume by the end of September.

Toyota hasn't resume normal activities after a half year, and sees no indication that we can restart in the future. The Russian automaker said that it would continue to provide maintenance services to existing customers of its Toyota and Lexus brand vehicles.

Chief Communication Officer Jun Nagata said Toyota will not sell or transfer its Russian business operations to other entities.

Toyota employs around 2,350 people in Russia, including its sole factory in St. Petersburg, which began production in 2007 and produces the RAV 4 sport utility vehicle and Camry sedan. It produced about 80,000 units in the year 2021.

Nagata told reporters that the company decided to close the factory to make sure it can offer assistance to its employees.

Toyota will support its employees for re-employment, re-skilling and well-being, including financial support. According to Russia's Industry and Trade Ministry, Toyota will fulfill its social obligations to employees and make compensatory payments.

St. Petersburg Governor Alexander Beglov praised Toyota's unprecedented measures to provide support to Russian workers, according to Tass.

The ministry is working with the city of St. Petersburg on how to use the production site after Toyota leaves, Tass said.