AutoBeta(AutoBeta.net)04/29 Report--

On April 26th, it was reported that Mercedes-Benz had sold its Russian subsidiary to the Russian Avtodom Group. Mercedes-Benz said in a statement that it had obtained the necessary official approvals and that the contract agreement had been implemented; the deal was completed in April 2023.

Hit by the war between Russia and Ukraine and disruptions in the supply of spare parts, Mercedes-Benz announced in March 2022 that it would suspend car production at its Russian factories and stop exporting cars to Russia. On October 26, 2022, Mercedes-Benz said it was considering a complete withdrawal from the Russian market and the sale of some of its assets in Russia to Russian car dealer Avtodom, but the completion of the deal would require approval from all relevant departments. Mercedes-Benz, which reported 1.8 billion euros in assets and 1 billion euros in liabilities in Russia in the third quarter of 2022, has suffered 709 million euros in losses related to its Russian business so far this year. It did not comment on the potential price of the sale. At the time, Avtodom, a Russian car dealer, said it would get permission from the German government committee by February and finalize a deal to buy all of Mercedes-Benz's Russian assets as soon as possible, including a Mercedes-Benz plant on the outskirts of Moscow.

In February 2023, Mercedes-Benz's industrial and financial services division in Russia was approved for sale to Russian car dealer Avtodom. It was reported at the time that the general manager of the Avtodom Group said that the Mercedes-Benz plant in the Moscow region was expected to reopen in the summer of 2023 and was looking for a Chinese car company to produce high-end Chinese cars, but did not disclose the brand or model, and the company said it was discussing local production of the car.

According to the official website of Mercedes-Benz Russia, the Mercedes-Benz plant in the Moscow region began producing cars in 2019 at a cost of 250 million euros and providing more than 1000 jobs, mainly producing Mercedes-Benz E-Class and other SUV models. The plant has an annual capacity of 25000 vehicles. With the completion of the sale of Mercedes-Benz's Russian subsidiary to the Russian Avtodom Group, it means that Mercedes-Benz will withdraw from the Russian market.

It should be noted that Mercedes-Benz is not the only car company planning to withdraw from the Russian market. According to statistics from Yale University in the United States, more than 1000 companies have announced their withdrawal from the Russian market since the outbreak of the conflict between Russia and Ukraine. Including French, Japanese and Korean brands. As early as May last year, a number of car companies successively chose to "survive without arms" to withdraw from the Russian market. Among them, Renault, which accounts for nearly 10% of the Russian car market, took the lead in announcing its withdrawal from the Russian market, followed by Toyota, Nissan, Ford and Mazda. Hyundai and Mercedes-Benz also plan to sell assets in Russia. In addition, before withdrawing from the Russian car market, car companies, including Toyota and Nissan, have set "buyback" provisions, which the industry believes are a way for them to return to the Russian market one day.

Data show that Russian car sales totaled 687400 units in 2022, down 41.24% from the same period last year. The sharp decline was mainly due to the conflict between Russia and Ukraine in February 2022. Since then, a large number of car companies have announced that they have suspended the export and sales of cars to Russia for a series of reasons, such as Western sanctions, supply disruptions and the intensification of the conflict between Russia and Ukraine. In this context, Chinese car companies continue to expand the Russian market. The market share also increased from 9% in January 2022 to 37% in December 2022, while Korean brands fell from 28.3% to 11.2%. European brands fell from 28.3 per cent to 7.3 per cent, Japanese brands from 17.9 per cent to 6.6 per cent and US brands from 1.1 per cent to 0.9 per cent.

As for whether the withdrawal of a number of western car companies from the Russian market will affect the sales of the Russian car market in 2023? On the 17th of last month, Russian Deputy Prime Minister and Minister of Industry and Trade Manturov said that the Ministry of Industry and Trade expects the total sales of various types of cars in Russia to increase by at least 30% in 2023. In addition, with regard to the outlook for the Russian car market in 2023, Manturov said: "as far as the auto industry is concerned, sales are expected to be higher at the beginning of the year than last year. The reason is simple, because we keep importing while increasing output. It will take some time to make a forecast, but sales will be 30% higher than last year. "

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