Numerous reports and analyzes revealed that car factories in Russia are facing many challenges and difficulties recently, which makes it facing a great predicament. As a result, Russia’s auto rates drop dramatically, not to mention economic sanctions such as the military conflict in Ukraine.
Auto factories in Russia are facing a big dilemma
Over the past few months, car factories in Russia are facing a major predicament and difficult challenges. Perhaps the main reason for this is Russia’s declaration of war on Ukraine, which led most of the suppliers to stop exporting production components that support the auto industry in it.
The shortage of electronic resources combined with severe economic sanctions and fines has put Russian factories in a big bind.
Among the negative consequences of this is that Russian car manufacturers are no longer committed to providing their car with important safety tools such as airbags, ABS, and ESP, which may indicate a collapse in the quality of safety in cars manufactured in Russia at the present time.
According to the French newspaper Le Figaro , production standards for car makers in Russia will be relaxed until February 1, 2023, allowing the government to certify the manufacture of new cars.
It is worth noting that the production rate of light Russian car manufacturers was up to 2.7 million units, and at the end of the last 2021 car factories in Russia achieved a positive rate despite the lack of chips, as reports of the Russian Federal State Statistics “Rosstat” revealed that they achieved a productivity of 1.4 million units, recording an 8.2% improvement in the overall production rate.
Contrary to the above, it is expected that Russian car factories will face a significant decline in production, due to several reasons, the most important of which are the ongoing Western economic sanctions, and the lack of logistical support, not to mention the lack of major components of the manufacturing process.
Withdrawals of international companies from Russia continue
In the same regard, well-known international companies have withdrawn from the Russian car market, similar to the Russian-Ukrainian crisis, and it is not surprising that the losses are huge and large on the level of all parties.
These withdrawals ranged from a final exit with no return, to suspending work only partially with the possibility of returning at any time (when the war between Russia and Ukraine subsides), or withdrawing investments only, such as withdrawing shares and shares.
The withdrawal of most of the famous international companies from continues due to the US and European economic sanctions, especially since these sanctions affect the financial channels that the Russian capital, Moscow, deals with the world directly, which means that all activities of these companies are practical.
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