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On March 23, French carmaker Renault announced a suspension of all activities at its Russian plant in Moscow, while Renault said in a statement that it had lowered its 2022 performance forecast. Renault expects an operating profit margin of about 3% in 2022. Previously forecast to be more than 4%; this year's car business will achieve positive free cash flow, which had been expected to exceed 1 billion euros ($1.1 billion) of free cash flow. Renault also said it was evaluating the options for its Russian joint venture, Avtovaz, and would be accountable to 45000 Russian employees. In its statement, Renault also stressed that it had taken the necessary measures to comply with international sanctions. On March 24, media reported that the Russian Ministry of Industry and Trade responded that it would decide by the end of next week how to use Renault's plant in Moscow.

In fact, affected by the conflict between Russia and Ukraine, Renault made a decision to suspend production in Russian factories as early as a month ago. On Feb. 25, Renault announced a suspension of operations at its car assembly plant in Moscow. "production at its plant in Moscow was suspended between February 28 and March 5 due to disruptions in parts supply, mainly due to stricter border controls in transit countries and forced changes in some established logistics routes," Renault said. " At the time, Avtovaz, Renault's Russian joint venture, also said that a plant in Togliatti in central Russia might suspend some assembly lines on Feb. 28 because of a continuing global shortage of electronic components.

On March 14, production at AvtoVaz's two plants in Togliatti and Izhevsk was suspended the previous week because of a continuing crisis in the supply of electronic components. On March 16, AvtoVaz announced that two plants would resume operations, and on March 21, Renault's plant in Moscow would resume production. However, only two days after the announcement, Renault once again announced the suspension of industrial activities in Russia.

Data show that Renault has three car assembly plants in Russia, one of which is located in Moscow. Renault Moscow factory was established in 2005 with an initial investment of 230 million euros. At present, the plant has 1850 employees and mainly produces Renault brand models, including Renault Duster, Renault Kaptur, Renault Arkana and Nissan Terrano, and the plant produces about 77000 cars in 2020.

As for Renault's relationship with AvtoVAZ, a Russian Volga car plant, Renault has a 68 per cent stake in AvtoVAZ, a carmaker in Soviet times, and about 10 per cent of Renault's revenue comes from Russia in terms of revenue. In 2004, Renault participated in the restructuring of AvtoVAZ and became its controlling shareholder, with Renault holding 68 per cent of AvtoVAZ and Russian state-owned Rostek holding the remaining 32 per cent. Renault returned to profit in 2021 after two years of losses, and sold 482300 vehicles in Russia in 2021, accounting for about 30 per cent of the Russian car market, which is Renault's second-largest market after France, according to data.

Under the influence of the shortage of many key automobile parts caused by the logistics interruption in the conflict between Russia and Ukraine, a number of automakers have previously announced that they will stop or reduce production in Russia, and stop exporting cars to Russia, including General Motors suspending operations in Russia and stopping exports to Russia. Hyundai suspended delivery to Russian dealers; Jaguar Land Rover suspended delivery in Russia; Renault Moscow plant shut down; BMW halted production in Russia and stopped exports to Russia. Mercedes-Benz Moscow plant stopped production and stopped exports to Russia; Volvo suspended exports to and business in Russia; Ford suspended its business in Russia. In addition, Toyota also announced that it would stop exporting new cars to the Russian market after the existing inventory was emptied. Honda and Nissan also announced that they would stop exporting cars to Russia. Renault is one of the western companies most influenced by Russia, and its share price has fallen by about 1/4 since the situation in Russia and Ukraine. Since Feb. 24, Renault shares have fallen 25.5% from $6.68 to $4.98 (March 23), and at one point fell to $4.63, according to statistics.

According to the data, Russia's cumulative car sales in 2021 were 1.67 million, an increase of 4.3% over 2020, of which the Renault brand sold 130000 vehicles for the year, ranking fourth. Renault is the largest car brand by sales in the Russian market, and industry insiders point out that Renault will face huge losses if it withdraws from the Russian market.

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