Volkswagen said on Friday, May 19, it had completed the sale of its Russian assets to local dealership group Avilon as part of its exit from the country following Moscow’s invasion of Ukraine last year.
The sale includes the German carmaker’s flagship factory in Kaluga, southwest of Moscow, which employs around 4,000 and delivers 225,000 vehicles annually.
“The new owner will acquire all shares in the Russian subsidiaries,” VW group said. “The deal has been approved by the Russian government authorities.” Details of the transaction were not disclosed.
Like other major car manufacturers, Volkswagen halted its operations in Russia last year after Moscow’s invasion of Ukraine triggered heavy Western sanctions that disrupted supply chains. But VW had to wait for the sign-off from the Russian government before it could complete its departure from the country.
The sale of assets by companies from “unfriendly countries,” as Moscow calls those that have imposed sanctions on it, requires approval from a government commission that monitors foreign investment.
Germany’s Handelsblatt financial newspaper said the carmaker would receive around €125 million from the sale, well below the actual value of VW’s Russian assets. “All activities are sold so we are not present in Russia anymore,” a VW spokesman told Agence France-Presse.
The war in Ukraine has sparked an exodus of foreign companies from Russia, including Starbucks and McDonald’s from the United States as well as Sweden’s H&M and Leroy Merlin and Pernod Ricard of France.
Japanese carmaker Nissan sold its assets in the country to the Russian government last year while France’s Renault handed over its Russian assets to Moscow for a symbolic one ruble.