Volkswagen may stop the assembly at GAZ facilities

The entry into force of US sanctions against the GAZ Group will lead to the fact that the company will not be able to continue the assembly of Volkswagen and Skoda cars at its site in Nizhny Novgorod. Recall that in 2017, even before the imposition of sanctions, the contract was extended until 2025, and now Volkswagen will be forced to break it, the Kommersant newspaper writes. The GAZ Group said that they would act on the basis of subsequent decisions by Volkswagen; the priority is the social security of employees. Volkswagen Group Rus says that from April 2018, the continuation of production at the plant in Nizhny Novgorod depends on the general license issued by OFAC. The company does not comment on future plans, only pointing out that due to the general political and economic situation and the ensuing consequences, the contract assembly of models at the GAZ Group plant in Nizhny Novgorod was already stopped on March 3rd, 2022, and from that moment on, the staff is idle .

So far, Volkswagen has not announced its exit from the Russian market, but industry sources say that it is endlessly impossible to keep factories idle and keep a staff of employees. According to Igor Morzharetto, partner of the analytic agency "AUTOSTAT", GAZ will lose income from contract assembly. For Volkswagen, the site in Kaluga is much more important, as the investments in it were much higher, although the prospects for continuing work there are still uncertain. Recall that the plant in Kaluga produces Volkswagen Tiguan crossover, Volkswagen Polo and Skoda Rapid liftbacks. At the facilities of the GAZ Group, the contract assembly of the Volkswagen Taos, Skoda Kodiaq and Karoq crossovers, as well as Skoda Octavia liftback was carried out. In 2021, 170.3 thousand cars were produced at the company's production sites, among which 118 thousand were produced at the company's plant in Kaluga, as well as 52.3 thousand cars at the production site in Nizhny Novgorod.

According to the information of the agency "AUTOSTAT", at present, the production of passenger cars is carried out only at two enterprises - Ulyanovsk Automobile Plant and "Haval Motor Rus". The rest of the car plants in our country are currently idle.