Major car brand set to lose £173million after boycotting Russia and selling factory for just £85
Most car manufacturers left Russia after the invasion of Ukraine
REUTERS/GETTY
Hyundai has unveiled plans to sell its plant in Russia for a staggering loss as more manufacturers look to drop Russian assets after the invasion of Ukraine last year.
The South Korean brand announced that they would be selling the plant for 10,000 Russian Rubles, which equates to just £85.
The plans were set out in a regulatory filing, with Hyundai Motor expected to take a 287 billion won (£173million) loss on the sale of the plant.
Hyundai has made efforts to end its activity in Russia, with operations at the plant being suspended since March 2022.
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A number of major car manufacturers have left the Russian market since the war in Ukraine.
Hyundai said it was seeking to transfer its assets in the plant in St. Petersburg to Russia’s Art-Finance.
The sale includes a buyback option, with an expectation that the transaction will be completed by December 28.
A Hyundai Motor official said it would receive 10,000 roubles in total for the sale of all its Russian assets, according to Reuters.
Denis Manturov, Russia's Industry and Trade Minister has reportedly approved of the deal, saying: “Hyundai and Art-Finance are clarifying the parameters of the deal, including the buyback option,” the RIA news agency reported.
Russia’s government commission on foreign asset sales demands discounts of at least 50 per cent on deals involving companies leaving the country.
In a bid to combat the number of major manufacturers leaving Russia, new brands have aimed to fill a gap in the market with a new Russian-made electric car.
The Avtotor Amber has been described as a “Tesla killer” and has unique features including two different charging ports on the same side of the car.
Moscow Polytechnic University showed the first images of the Amber, with the number plate suggesting that it is purely a test model and will not be the finished product.
Based on first impressions, the vehicle looks like a pickup truck, but is much shorter, does not have a cargo bed, and has no rear windows.
The public reaction to the new EV has been rather critical, with some comparing it to a washing machine and even the Fiat Multipa, which has been ranked as the world’s ugliest car.
Avtotor’s Amber is expected to begin production in 2025 at its plant in Kaliningrad, which used to manufacture models for brands like BMW, Ford and Kia.
One social media user joked that the EV ran on AAA batteries and questioned whether they had a remote control for it.
Another said: “Now we finally understand why Russian soldiers were stealing washing machines from Ukraine. They needed them to paint them red and put wheels on them.”
LATEST DEVELOPMENTS:
The Avtotor Amber electric car
MOSCOW POLYTECHNIC UNIVERSITY
The majority of Western car manufacturers have either left Russia or ceased operations, with Chinese brands choosing to invest in the nation.