RUSSIA: A Russian court froze all assets of Volkswagen (VOWG_p.DE) in Russia on Monday, documents from the court showed.
Many foreign carmakers, including Volkswagen, stopped operating in Russia after the Western nations imposed unprecedented sanctions on Moscow as a result of the war in Ukraine.
The Russian automotive manufacturer GAZ, which had a contract with the German company to build vehicles at its Nizhny Novgorod plant, sued it for breach of contract after the car manufacturer’s termination of the agreement in August.
GAZ estimated that it had lost nearly 16 billion roubles ($207.79 million) as a result of the terminated agreement.
The German automaker is making an effort to sell its flagship Russian plant in Kaluga, which is located south of Moscow. Since March 2022, the plant, which can produce 225,000 cars annually, has been on furlough.
The VW Group’s Skoda Auto, a Czech automaker, announced earlier this week that a deal to sell its Russian assets was nearing completion.
VW Group Russia has been producing cars in Kaluga since November 2007. Full-cycle manufacturing started in 2009.
A contract for the contract assembly of Volkswagen and Skoda cars at the GAZ plant in Nizhny Novgorod was signed by the companies group in Russia and GAZ Group in 2011.
Volkswagen Group Rus combines the work of seven group of the German car manufacturing brands that are sold in Russia—Volkswagen, Commercial Vehicles, Volkswagen Skoda, Lamborghini, Audi, Ducati, and Bentley.
The GAZ Group, a Russian automotive company, is headquartered in Nizhny Novgorod. It consists of 18 manufacturing facilities dispersed across eight distinct Russian regions, as well as sales and service groups.
Before selling any Russian assets, Moscow needs companies from “unfriendly” countries—especially those that have imposed sanctions on Russia—to receive government commission authorization.
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