Yahoo Finance Stellantis suspends car production in Russia as sanctions hit
Stellantis (STLA) has become the latest company to sever ties with Russia as the car and van producer suspended operations in its factory near Moscow as sanctions hit supplies.
The world's fourth-largest carmaker, manufactured and sold the Peugeot, Citroen, Opel and Jeep brands in Russia, and had just 1% share of the market. It was planning to build Fiat-branded vans there, and also operated a factory with Japanese rival Mitsubishi Motors (MMTOF).
Stellantis said its Kaluga factory had been operating at a low level for weeks after halting exports and imports to and from the Kremlin last month.
Read more: Ukraine’s economy to be almost cut in half, says World Bank
In March, the Netherlands-based automaker warned it would need to shut the plant as it was running out of parts. Embargoes on some banks in the country following the invasion of Ukraine have also made it more difficult to deal with Russian firms.
"Given the rapid daily increase in cross sanctions and logistical difficulties, Stellantis has suspended its manufacturing operations in Kaluga to ensure full compliance with all cross sanctions and to protect its employees," it said on Tuesday. It added that it condemned violence and supported "all actions capable of restoring peace".
The company, which was formed in 2021 through the merger of Peugeot owner PSA and Fiat Chrysler, had just 1% share of the market, and said Russia accounts for €20m ($21.6m, £16.6m) to €30m of its annual profit.
Shares in Stellantis fell 3.6% in pre-market trading on Tuesday.
Read more: Carmakers hit the breaks on Russia as sanctions bite
It comes after hundreds of foreign companies across the world halted business in or with Russia following the invasion of Ukraine on 24 February.
Stellantis rival Volkswagen (VOW3.DE), the second largest car maker in the world, which also had a plant in Kaluga, halted its operations just over a week after the start of the war.
Swedish carmaker Volvo (VOLV-B.ST) was the first international automaker to suspend car shipments to Russia until further notice.
German carmaker, Mercedes-Benz (MBG.DE) stopped selling cars and vans to Russia, joining Aston Martin (AML.L) and Jaguar Land Rover in stopping exports to the country.
Ford (F), BMW (BMW.DE), Renault (RNO.PA) have also shut Russian plants as supply shortages limit production.
Watch: Exodus: western companies abandon Russia
