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Renault Resumes Production At Moscow Plant Following Suspension

Renault resumed operations at its Russian plant in Moscow on Monday, according to a company spokesperson who spoke to Reuters.

The automaker was one of many that paused production in the wake of Russia’s invasion of Ukraine. Whereas many others pulled out of the market in response to economic sanctions, Renault said in late February that it was pausing production due to a “forced change in existing logistic routes” and has not pulled out of the market.

Renault is Russia’s largest foreign automaker and in mid-March, unnamed sources said it did not want to exit the market for fear of losing its production sites. The automaker was responding to threats made by the Russian government suggesting it would nationalize the production plants of foreign companies that pulled out of the market during its invasion of Ukraine.

The French automaker also owns a controlling 67.61 percent share in Lada Auto Holding, which in turn owns Avtovaz, the maker of the very popular Lada brand of vehicles. In all, Renault controls about 30 percent of Russia’s automotive market, employs around 40,000 people, and makes eight percent of its core earnings there, according to Citibank.

Avtovaz said Monday that it was partially halting production at its plants in Togliatti and Izhevsk between March 21-25 due to shortages of electronics parts. Along with Lada models, the Izhevsk plant also produces the Dacia Logan and Sandero at the plant, according to Reuters.

Reports indicate, though, that the economic sanctions being imposed against Russia could cause its automotive market to shrink by 50 percent this year. Along with the economic sanctions, supply lines and production pauses have affected the market, too.

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