General Motors says it will substantially withdraw from the ailing Russian new car market by the end of the year, according to reports in the German media. It will also close its factory near St Petersburg, with the expected loss of as many as 1000 jobs.

German newspaper Handelsblatt quoted Opel CEO Karl-Thomas Neumann as saying that GM believed the prospects for the Russian new car market were "not good" over the short, medium and longer term.

“We do not have the appropriate localisation level for important vehicles built in Russia, and the market environment does not justify a major investment to further localise," Neumann also said in an official statement.

The American car maker will end sales of Opel cars by the end of this year, and only two or three Chevrolet models will continue to be offered on the Russian market. "Contract assembly of Chevrolet vehicles at [Russian car maker] GAZ will [also] be discontinued in 2015."

Sales of Cadillac models will continue, however, and production of the next-generation Lada-based Chevrolet Niva will also go ahead from 2016.

Russia’s economy has taken a triple hit in the last 12 months, with the crash in oil prices hitting the country hard. The Russian ruble has collapsed against the dollar, increasing the cost of imported vehicles. Russian consumers are also suffering significant inflation.

The country’s economy is also suffering from Western economic sanctions imposed over the conflict in the Ukraine, which borders Russia.

 The 2016 Lada-based Chevrolet Niva will survive GM's cull of Russian market models