MOSCOW, (Reuters) – Hyundai (005380.KS), opens new tab on Friday said it had signed a deal to sell its two Russian plants, making the South Korean firm the latest global carmaker to exit Russia since the Ukraine conflict began.
The Russian buyer, Art-Finance, said it had finalised the purchase of Hyundai’s St. Petersburg plants on Jan. 24, and received approvals from the Russian government and federal anti-monopoly service.
Most European, Japanese and South Korean carmakers suspended production and left the Russian market after Moscow despatched troops to Ukraine in February 2022, often selling for a nominal fee as Russia has made it difficult to extract funds.
Hyundai Motor said in December it planned to sell its Russian assets for 10,000 roubles ($111.69), taking a 287 billion won ($214.7 million) loss. Operations at its main plant were suspended in March 2022.
In a statement on Friday Hyundai Motor confirmed it had signed a deal to sell its Russia manufacturing facilities, without naming Art-Finance, with whom it had previously said it was negotiating.
Art-Finance said Hyundai’s assets had become part of its AGR Group. It said the assets “include two production sites of a company located in St Petersburg: a factory in the Kamenka industrial zone and a factory in the Shushary industrial zone”.
The second factory had belonged to General Motors before Hyundai purchased it in 2020. The two plants have a combined annual capacity of around 300,000 vehicles.
Art-Finance is owned by Andrei Pavlovich, who acquired Volkswagen’s (VOWG_p.DE), opens new tab Russian assets in May 2023. Volkswagen’s factory was renamed to AGR Automotive. Art-Finance said the Hyundai plant would be renamed once all registration procedures were complete.
Hyundai in December said it planned to continue operating post-sales services for existing vehicles in consideration of local conditions in Russia.
Chinese carmakers have been plugging the gaps left in Russia by their departing Western competitors, but Chinese car sales appear to have peaked at more than 56% of the market as Russia’s domestic production has slightly recovered.
($1 = 89.5325 roubles)
($1 = 1,336.7200 won)
Reporting by Gleb Stolyarov and Alexander Marrow; additional reporting by Heekyong Yang in Seoul; Editing by Jason Neely and Jan Harvey
