Over 2,000 Employees to lose thier jobs as Toyota set to close its Russian plant.

Due to a lack of essential parts and supplies as a result of Russia’s invasion of Ukraine, Toyota will shut down its plant in St. Petersburg, Russia, and may even sell it.

After Russia invaded Ukraine in March, the company stopped operating the facility. Additionally, it halted Russia’s automobile imports.

Toyota stated on Friday that although it has kept the facility ready to resume output if necessary for the past six months, there are currently no signs that it will be able to do so.

The plant can produce 100,000 units annually. With exports to Belarus, Kazakhstan, and Armenia, it built the Camry midsize sedans and RAV4 crossover SUVs for the Russian market.

A Toyota Europe spokeswoman informed Automotive News Europe that if the facility is sold, “rebadged versions of the Camry and RAV4 will not be built there.”

The carmaker said that it will maintain a reorganized organization in Russia to support current Toyota and Lexus customers.

Toyota added that in addition to financial help above the minimum criteria, employees would be given assistance with finding new work, retraining, and wellbeing.

2,350 people work for Toyota in Russia. To handle marketing, sales, and financial operations, roughly 1,900 people are employed at the facility in St. Petersburg and about 450 people are working there.

“We think about 2,000 people will leave Toyota in Russia,” the Toyota spokesman said. The workforce retained in Moscow will mainly continue to help customers in Russia with parts import and distribution.

Toyota sold 221 vehicles in Russia in August, down 97 per cent on the same month last year, according to the Moscow-based AEB Automobile Manufacturers Committee. The total market fell 62 percent to 41,698 units.

Last year, the Saint Petersburg plant built 42,235 RAV4s and 38,547 Camry sedans, according to Toyota.

With 38,441 units sold, the RAV4 was the 11th best-selling model in Russia last year, ahead of the Camry at 31,983 units, figures from the AEB show.

The factory began production in December 2007 after a 38 billion ruble investment (about $680 million at current exchange rates).

Moscow’s invasion of Ukraine on February 24 has prompted a mass corporate exodus from Russia, leaving behind assets worth billions of dollars.

Volkswagen and Nissan are among automakers that have suspended production, furloughed workers and halted imports, leaving a gap in the market for Chinese car companies.

More than 750 companies have announced they are curtailing operations there to some degree, according to the Yale School of Management.

In May, Renault sold its majority stake in AvtoVAZ, Russia’s biggest automaker and owner of the Lada brand, to a Russian science institute, reportedly for just one ruble with a six-year option to buy it back.

 

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