South Korea’s Hyundai Motor ( 005380.KS ) is contemplating suspending operations in Russia, together with promoting a manufacturing facility there, South Korean media reported on Tuesday.
Many Russian factories have halted manufacturing and laid off employees because of a scarcity of high-tech tools because of sanctions and the emigration of Western producers after Moscow on February 24. despatched armed forces to Ukraine.
Hyundai Motor lately submitted a report back to administration analyzing its future prospects in Russia because of a troublesome working surroundings, the Dong-a Ilbo newspaper stated, citing unidentified auto business sources.
Hyundai Motor was not instantly obtainable for remark when contacted by Reuters.
Hyundai Motor, which is among the many world’s prime 10 automakers by gross sales together with Kia Corp ( 000270.KS ), produces about 200,000 autos a yr in Russia, about 4% of its world manufacturing capability.
“We estimate that Hyundai and Kia collectively could endure a minimum of 450 billion rubles this yr as a result of enterprise surroundings in Russia. received ($315 million) in losses,” stated Samsung Securities analyst Esther Yim.
Hyundai Motor suspended operations at its Russian plant in March, and an organization doc confirmed it didn’t promote vehicles within the nation in August and September.
“Whereas it’s nonetheless unclear what Hyundai will do with its manufacturing facility in Russia, Hyundai has lots to think about earlier than really exiting Russia, corresponding to its monetary state of affairs and relations with Russia and the US,” stated analyst Kim Jin-woo . Korea Funding & Securities.
Final week, Nissan Motor Co Ltd ( 7201.T ) stated it might promote its Russian enterprise to a state-owned firm for 1 euro, leaving the nation with about 687 million euros within the newest expensive exit by a worldwide firm. .
($1 = 1,428,9600 received)
Heekyong Yang reviews; Edited by Lincoln Feast
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