Back to the 1990s: Russians are being forced to choose between overpriced foreign cars and locally assembled scrap metal
At many automobile factories abandoned by international corporations in the spring of 2022, Russian companies have already launched domestic production. At the former Hyundai Motor Group plant in St. Petersburg — sold for a symbolic 10,000 rubles to Art-Finance, a company linked to AGR Automotive Group — workers now assemble Solaris cars using leftover Kia and Hyundai kits. Plans are also in place to produce Chinese Chery models there.
The former Toyota plant in St. Petersburg was supposed to produce Aurus vehicles — the Senat limousine, Komendant SUV, and Arsenal minivan — but the launch has been postponed indefinitely.
The Nissan plant was taken over by the state-owned AvtoVAZ and now produces vehicles under the Russian Xcite brand, including the X-Cross 7 crossover, which is based on the Chinese Chery Tiggo 7 Pro.
Automakers such as Renault, Stellantis (Citroen, Peugeot, Opel, Fiat, Dodge, Jeep, Ram, Alfa Romeo, Maserati etc.), Honda, Mazda, Suzuki, Volkswagen Group (VW, Skoda, Audi), Mercedes-Benz, BMW, Jaguar Land Rover, Volvo, Porsche, and Rolls-Royce have all partially or fully withdrawn from the Russian market.
Many of these companies sold their Russian assets for an even more symbolic one euro or one ruble, retaining the option to return. Volkswagen, however, sold its Russian division to Art-Finance for €125 million without a buyback clause, similar to the move made by Volvo. Porsche, meanwhile, has been unable to sell three of its Russian subsidiaries despite suspending operations.
Early in the war, Russia’s Industry and Trade Ministry published a list of goods eligible for “parallel import,” allowing companies to buy cars directly from factories and bring them into Russia without the trademark holder’s consent. Nearly all foreign cars and parts can still be imported this way, though Renault was excluded from the list in August 2022 after AvtoVAZ agreed to handle warranty service and spare parts for Renault owners. Russian demand for foreign cars remains strong, which has pushed dealership prices to new highs.
“Not considering a Chinese car”
A cheaper option is buying a car from dealers or individuals who import vehicles from abroad under the pretense of “personal use.” This allows importers to avoid paying full recycling fees, which are set at just 3,400 rubles ($43) for new cars and 5,200 rubles ($65) for vehicles up to three years old.
Dealers importing cars for commercial purposes, by contrast, must pay 667,400 rubles ($8400) for vehicles with engines of 1 to 2 liters (under three years old) and 1.2 million rubles ($15,000) for older vehicles.