Car companies throughout the world have been suffering through supply chain issues, which have forced them to cut production. Now the Russian invasion of Ukraine is causing more problems for car companies that do business in that part of the world. Some carmakers are limiting business activities in Russia, or even exiting the market altogether.

Russia is a small market for auto sales. Only about 1.57 million new cars were sold in the country last year. There were also less than 2 million cars built in Russia in 2021. But Russia is a big market for Renault, Volkswagen, and Hyundai. Each of them has more than a 10% share of Russian auto sales. All three companies also manufacture a significant number of cars in Russia as well.

Russia's invasion of Ukraine, and the global reaction to it, has had an effect on automakers that do business in that region. Some of them have announced changes to their operations in Russia and Ukraine.

Related: How Western Sanctions Affect Volkswagen, Stellantis, And Renault Plants In Russia

Most Car Production In Russia Has Come To A Stop

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Toyota

Toyota has announced major changes to its operations in Russia and Ukraine in response to the ongoing conflict in that region.

Toyota already stopped all sales activities in Ukraine on 24 February. Now, the Japanese automaker has announced that production at its St. Petersburg plant will cease on March 4. That plant builds RAV4 and Camry models for sale in the Russian market. Toyota has already stopped importing cars into Russia because of supply chain issues.

Renault has suspended production at some of its assembly plants in Russia due to shortages of components.The French carmaker Renault accounts for nearly 40% of all the vehicle production in Russia. Their plants in Russia include one in Moscow that builds the Kaptur, Duster, Arkana, and Nissan Terrano. Renault also has a controlling ownership stake in Russian automaker, AvtoVAZ.

Related: Why Volkswagen Is Not Bringing Skoda To The US

Russia Is A Big Market For VW And Hyundai

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Skoda

South Korean automaker Hyundai Group manufactures 230,000 cars per year at a plant in St. Petersburg. That accounts for about 27% of Russia's total vehicle production. Hyundai has suspended production at the St. Petersburg factory from March 1-5 due to supply chain issues, but operations will resume next week.

Czech carmaker Skoda, which is part of the Volkswagen Group, is continuing to run its Russian operations, but plants in the Czech Republic have reduced production in anticipation of lower demand for cars in Russia and Ukraine. Russia is the second-largest market for Skoda.

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