August 15, 2022

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Škoda Auto continues to cut ties with Russia

Škoda Auto continues to cut ties with Russia

Since its inception, the Russian invasion of Ukraine has caused an economic earthquake, greatly affecting all kinds of businesses and sectors across the continent. Among them is the auto industry, that is, in a national key, talking about the famous Czech company Škoda.

Thus, the company announced that it would permanently abandon its plant in Nizhny Novgorod, one of the two production centers it owns on Russian soil.

Although the news was nothing more than an open secret, it was officially announced in recent days. Already in March, shortly after the outbreak of the conflict, the company announced that it would paralyze production at its two plants in the country: the one located in the same Nizhny Novgorod and the other located in Kaluga.

Skoda Auto in Kaluga |  Photo: Škoda Auto

Since then, the company has been studying various scenarios while waiting for a final decision, as all rumors indicated, to permanently separate from the Russian plant.

In addition to the lack of parts produced in different EU countries or Ukraine itself, which cannot be imported into Russia due to the sanctions imposed on it, there is an atmosphere of complete uncertainty regarding the development of the conflict, which makes it impossible to predict. What is the situation in the future and whether it is possible to resume production at some point.

“We know for sure that we will not continue in Russia. We will eliminate Nizhny Novgorod” It was a decision that the company had thought about for a long time, said Jaroslav Povchik, head of the Škoda union, already in May.

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The Nizhny Novgorod plant, located about 400 km northeast of Moscow, is owned by the Russian company GAZ, which has been cooperating with Škoda since 2011. It includes the production of Kodiaq, Karoq and Octavia models and employs about 200 workers, most of whom have reached agreements with the company to distance themselves about it.

The situation is somewhat more complicated at the Kaluga plant. Unlike the first, this car belongs directly to Volkswagen and employs about 4,000 people. Although production has been paralyzed here since last March, the company hasn’t made a final decision about its future.

However, the gradual deterioration of the conflict is not exactly cause for optimism. Russian President Vladimir Putin has recently gone so far as to assure that those foreign companies that have left the country will regret it: “They will regret it, not because we threaten anyone with anything. They will regret it because Russia is a country with great potential.” He said.