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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Hyundai Motor Co. is currently unable to repurchase its former manufacturing plant in Russia, which it sold following the outbreak of the Ukraine war, according to a source familiar with internal discussions, Reuters reported on Tuesday.
The source said it is “not a situation where repurchasing is possible,” referring to the automaker’s former production facility in Russia that was sold to a local company. The person did not provide further details but cited the ongoing war in Ukraine, saying that “the war needs to end” before any such move could be considered.
Hyundai entered the Russian market in 2010 by opening its plant in St. Petersburg. However, after Russia’s invasion of Ukraine triggered sweeping Western sanctions, the company faced supply chain disruptions and suspended operations at the plant in March 2022. In December 2023, Hyundai sold its entire Russian business, including the St. Petersburg plant, to Russian firm Art-Finance.
Since then, AGR Automotive Group, a subsidiary of Art-Finance, has continued producing vehicles at the plant under the same brand names previously used by Hyundai, including the Solaris.
While the terms of the deal were not officially disclosed, the agreement reportedly included a buyback option allowing Hyundai to repurchase the plant within two years. As the transaction was finalized in January 2024, that option is expected to expire as early as next month.
According to Reuters, it remains unclear whether Hyundai will abandon the buyback option entirely or seek to renegotiate an extension once the deadline passes.
Although peace negotiations led by the administration of former U.S. President Donald Trump are underway, no final agreement has been reached, and Western sanctions against Russia remain in place.
Before the war, Hyundai produced more than 200,000 vehicles annually at its St. Petersburg facility.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
