Russian auto-leading firm states Renault needs to compensate USD1.3 bn to re-enter Russian market

(MENAFN) Russian automaker AVTOVAZ has stated that Renault will need to compensate up to $1.3 billion if it wishes to re-enter the Russian market and regain its former business. This follows Renault's exit from Russia in 2022 amid international pressures after the Ukraine conflict escalated.

In 2022, AVTOVAZ acquired Renault's share in their joint venture for a symbolic 1 ruble, with an option to return within six years. AVTOVAZ CEO Maxim Sokolov explained that Renault would need to reimburse investments made during its absence, which are expected to total 112 billion rubles ($1.3 billion) between 2023 and 2025. These investments far surpass the annual amounts Renault had previously invested in the Russian market, making it clear that Renault’s return would come at a higher price than its initial exit.

Renault had sold its entire stake in Renault Russia and 68% of its stake in AVTOVAZ in 2022, and its assets were transferred to Russian state ownership. In 2022, Russia also began producing a new version of the Moskvich car at Renault’s former Moscow factory. Renault wrote off over $2 billion in losses due to its withdrawal from Russia.

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