Another automaker will likely join the exodus of foreign businesses from Russia, as Hyundai is reportedly considering selling off its production facilities in the east European country.
Hyundai Russia plant
South Korea’s Dong-a Ilbo newspaper cites unnamed industry sources as saying that the automaker recently submitted a report to management detailing its future plans in Russia due to the difficult operating environment. Hyundai Motor Company was not immediately available for comment.
“We estimate that Hyundai and Kia together could generate at least a 450 billion won (around Php 18.39 billion) loss this year due to the business environment in Russia,” according to Samsung Securities analyst Esther Yim.
Hyundai's Russian production accounts for four percent of its global output
“While it’s still unclear what Hyundai would do with its Russia factory, Hyundai has a lot to factor in to actually exit from Russia, such as financial situations and its relationship with Russia and the United States,” Korea Investment & Securities analyst Kim Jin-woo said.
Together with affiliate Kia Corporation, Hyundai builds around 200,000 vehicles in Russia annually, representing four percent of its global production output. Hyundai started its Russian operations in 2008 with Hyundai Motor Manufacturing Rus LLC (HMMR), the automaker’s sixth global production facility outside of South Korea.
Nissan earlier announced the sale of its Russian operations to a government entity
Many businesses in Russia have suspended manufacturing operations on account of a shortage in sophisticated equipment. This was brought about by sanctions placed on the country as well as the mass exit of Western companies resulting from Russia’s ongoing conflict with Ukraine.
On October 11, Nissan announced that it would be selling its Russian operations to a state-owned entity. The sale will be finalized for just one euro (Php 57.85), meaning that the Japanese automaker will be absorbing a loss of about $687 million (around Php 40.4 billion). However, Nissan will reportedly still have the option to buy back the Russian plant within the next six years or until 2029.
Get more auto industry updates at Philkotse.com.
Know more about Hyundai
In the local market, Hyundai Motor Philippines Inc., under the leadership of Lee Dong-Wook now sells Hyundai models locally as of 2022.
The brand’s lineup consists of the new crossovers which includes the Tucson, Santa Fe, and Creta. Under the MPV category, the Korean marque then has the new Staria model. The most affordable model in the local Hyundai lineup is the Creta's GL variant, which is priced at Php 998,000. The most expensive meanwhile is the Santa Fe, which retails at Php 2,420,000.
Of note, Philkotse makes sure to update its Hyundai car price list as needed. It also provides an up-to-date list of car promos for the said brand, as well as a list of Hyundai dealerships around the country.
Recent posts
- The company will be selling its operations to the Russian government. Oct 12, 2022
- mazda said to end russia production Sep 27, 2022
- Toyota ends Saint Petersburg production Sep 26, 2022
- russia ukraine war global vehicle shortage Mar 19, 2022
- car brands halt operation in Russia Mar 07, 2022
