Auto major Mercedes-Benz is latest to exit Russian market, sells its stock to a local investor
The move comes after Nissan, Toyota, Renault and GM announced to shut their operations in Russia amidst the ongoing conflict between Ukraine and Russia.
Mercedes-Benz has officially announced its exit from the Russian market on Wednesday. News agency Reuters reported that Mercedes-Benz will sell its stake in its industrial and financial services divisions to a local investor. The company's shares are being sold to vehicle dealer network Avtodom.
As a result of the ongoing geo-political situation between Russia and Ukraine, Mercedes Benz had halted production in Russia from the early March. Despite market difficulties, the German brand sold 9,558 vehicles in Russia from January to September -- a 72.8 percent reduction from the comparable period of previous year, data available with Association of European Businesses (AEB) has revealed.
While presenting third-quarter results, Mercedes Chief Financial Officer Harald Wilhelm stated that the transaction was not expected to have substantial effects on the group's profitability and financial position beyond those announced in prior quarters.
"Final completion of the transaction is subject to the authority's approval and the implementation of contractually agreed conditions," Wilhelm said. According to a Mercedes spokesperson, the company's 15 percent shareholding in Russian truck maker Kamaz would not be affected by the forthcoming deal and it will be passed on to Daimler Truck this year as planned.
The next major automaker planning to leave Russia is Ford. Details of the exit plan haven't been released yet. Nissan left Russia earlier this month, following Toyota and Renault.
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