ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Business

Japan carmakers slashing Russian production

The Toyota Land Cruiser Prado is no longer assembled in Russia.

TOKYO -- The protracted economic downturn in Russia is beginning to take a toll on Japanese automakers' output there.

     Toyota Motor on Tuesday announced that it halted Russian production of sport utility vehicles at the end of June, switching instead to exports from Japan. A joint venture in Vladivostok with Mitsui & Co. and a local automaker had been turning out Land Cruiser SUVs, but that contract ended and Toyota concluded that continuing the business would be difficult.

     Toyota's Russian sales in the first half of this year fell about 30% from the same period the previous year. Sales in 2014 were strong, rising 6% from the prior year to a record 183,000 vehicles. Since then, however, a slowdown in consumer spending appears to have become more pronounced due to falling commodity prices and a weakening of the ruble.

     In 2007, Toyota began producing Camry sedans at a plant it opened in St. Petersburg. It is planning to begin making RAV4 SUVs at that location in 2016. Sluggish automobile sales in Russia have prompted it to consolidate production to that city.

     Nissan Motor, which has been producing autos at four Russian sites, saw April-June sales drop 12.6% from the year-earlier period. Concerns about rising inventories have prompted it to reinstitute production cuts first implemented in March.

     Mitsubishi Motors has a Russian joint venture plant with France's PSA Peugeot Citroen with the capacity to make roughly 40,000 vehicles a year. That factory suspended production for eight days in late April and early May because of sluggish sales dating back to the end of last year. Output was reduced beginning in May and the site is now operating at just about 70% of capacity, a level it will maintain through September.

     Russia's new-car market amounted to 2.49 million vehicles in 2014. However, consumer spending slumped this year due to falling crude oil prices and sanctions imposed by the West as a result of the Ukraine conflict.

(Nikkei)

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends January 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media