Toyota ends production in Russia over supply chain issues

40
2
Toyota ends production in Russia over supply chain issues

MOSCOW Japan's Toyota Motor Corp said on Friday it had decided to end vehicle production in Russia due to the interruption of supplies of key materials and parts.

Toyota had suspended production in St Petersburg in March due to supply chain problems and stopped importing to Russia.

We have fully retained our workforce and ensured that our facility is ready to restart production if the circumstances allow, it said in a statement.

After six months we have not been able to resume normal activities and see no indication that we can restart in the future. Toyota said that staff would be available for re-employment, re-skilling and wellbeing, including financial support above legal requirements.

The Russian Kommersant newspaper, which first reported the plans, said the factory, which has a capacity of 100,000 units a year and produced the Camry and RAV 4 models, would be preserved and might be sold in the future.

Russia's Ministry of Industry and Trade said it was working with regional authorities on ways to develop the site.

Many factories in Russia have suspended production due to shortages of high-tech equipment because of sanctions and an exodus of Western manufacturers since Moscow sent armed forces into Ukraine on February 24.

Renault sold its majority stake in Russia-based carmaker Avtovaz to a Russian science institute, reportedly for one rouble.

Luxury car makers such as Jaguar have stopped exporting to Russia and Ford and BMW have suspended production.

Volvo laid off some of its staff in Russia last year, which accounted for 3 per cent of net group sales, after suspending sales, service and production in February.

Michelin and Nokian plan to quit Russia. Michelin said supply chain problems had made it impossible to do business there because of sanctions.