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With The Stellantis Facility Idle, Russians Utilise A Chinese Partner To Make Citroen Automobiles

With The Stellantis Facility Idle, Russians Utilise A Chinese Partner To Make Citroen Automobiles
Russian automaker Stellantis stopped making cars in April 2022.
However, customs records and two persons familiar with the situation indicate that Russian operators continued to work with a Chinese partner the next year to begin producing new Citroen models manufactured by Stellantis notwithstanding the decision.
Customs documents obtained from a commercial trade data source revealed that in December of last year, Automotive Technologies, a Russian firm, imported a minimum of 42 car kits for the purpose of constructing the Citroën C5 Aircross model at the Kaluga facility. The plant is still majority-owned by Stellantis.

The data indicated that the kits were made by Dongfeng Motor Group in China.
The Citroën C5 Aircross was being assembled in the Kaluga factory by Automotive Technologies, two employees at several Russian vehicle shops have stated. Since the material is confidential, the sources only discussed their names.
There is no indication from the customs records or other sources that Stellantis was aware of the imports, and it is unclear if the Chinese kits included components that are subject to the Western sanctions against Russia, to which Beijing is not a party.

However, the results show how little influence Western businesses, including Ikea and Carlsberg, now have over their brands following the suspension of their Russian activities or their departure from the nation following the invasion of Ukraine in February 2022.
They also demonstrate Moscow's increasing dependence on Beijing, particularly in the car industry.
Stellantis responded to Reuters' findings by stating that it has "lost control of its entities in Russia" after December 31, 2023.

Stellantis reported that as a result, company had recorded a loss of 144 million euros ($154.53 million), of which 87 million euros were in cash and financial equivalents.
Email requests for comments were not answered by Russia's ministry of industry and trade, Automotive Technologies, or the Chinese state-owned company Dongfeng.
Russia's automotive sector had previously been highly dependent on foreign capital, machinery, and parts, especially from Europe.

Stellantis attributed the cessation of activities on logistical challenges and the sanctions imposed on Moscow.
It owns 70% of the Kaluga factory, with Mitsubishi Motors holding the remaining 30% opens new tab. With a yearly production capacity of 125,000 vehicles, the plant manufactured Peugeot, Citroen, Opel, and Mitsubishi automobiles before Russia invaded Ukraine.

Even though a large number of international automakers have subsequently exited the Russian market, certain goods still enter the nation thanks to a Moscow-instituted "parallel imports" programme. This permits importers to import goods from overseas without the owner of the trademark's consent.

According to four Russian auto dealers, Citroen models are still offered for sale in Russia.
The owners of the Kaluga facility held a formal launch party in December 2023 to begin "production of medium-sized crossovers." Reuters was not given an invitation.
Automotive Technologies, a business that Galina Dolgolenko owns 100% and was founded in Moscow in March 2023, announced in December that it was putting together a trial batch of 48 imported automobiles in preparation for mass production to start in 2024. The supplier and car model were not disclosed.

In December, the Russian publication Vedomosti quoted Pavel Bezruchenko, the strategic development director of Automotive Technologies, who stated that the company imports cars from China through parallel imports.
There were no comments on the issue from Bezruchenko.
Automotive Technologies notified two Reuters workers that they would be receiving Citroen C5 Aircross cars, which will be put together in Kaluga from imported kits.
It was unclear, though, if the vehicles leaving the assembly line would still bear the Citroen name.
Although sources told Reuters that the Moskvich 3 model was a Sehol X4 manufactured by JAC Motors and constructed in Moscow using kits acquired from a Chinese partner, Russia brought back the Soviet-era Moskvich automobile in 2022.

Through a commercial joint venture, Dongfeng and Stellantis, the third-largest automaker in the world based on revenue, enable Dongfeng to produce and market Stellantis vehicles in China.
Chinese automakers have been filling the voids left by their fleeing Western rivals in Russia, but since Russia's domestic production has somewhat recovered, Chinese automobile sales seem to have peaked at more than 56% of the market.

Christopher J. Mitchell

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