In response to Putin’s invasion of Ukraine, a number of companies have already announced that they will discontinue their activities in Russia. Now Volkswagen is following suit.
Like several other international corporations, Volkswagen is now suspending its business in Russia because of the war against Ukraine.
“Against the background of the Russian attack, the Group’s board of directors has decided to stop the production of vehicles in Russia until further notice,” it said on Thursday. All exports of the largest European car group to the Russian Federation would also be “stopped with immediate effect”. Individual brands such as Porsche also made statements.
VW operates its own production facilities in Kaluga, southwest of Moscow, and in Nizhny Novgorod further east. The Wolfsburg company announced that production will now be ended at the locations for the time being. Likewise, no more cars should be exported to Russia. “With the extensive interruption of business activities, the Group Executive Board is drawing the conclusions from the overall situation, which is characterized by great uncertainty and the current upheavals.” Employees in Russia will initially receive continued wages.
In other countries, the beginning of the war had already slowed down production by car manufacturers – including at Volkswagen. After the corona and chip crisis, there are further downtimes in plants such as Zwickau, Wolfsburg or Hanover because there are no supplier parts from western Ukraine, for example. “Our task force continues to work on solutions across divisions and brands,” explained VW.
Production limited due to bottlenecks
First, production in Saxony had to be restricted, and on Tuesday the new supply bottlenecks then spread to additional factories. According to this, production at the Wolfsburg headquarters will be reduced “in stages on different lines” starting next week. In the week after, it will probably not be possible to manufacture there at all, according to the latest information. In-house supplier plants are also affected.
For the headquarters of the light VW commercial vehicles (VWN) in Hanover, a possible standstill from the coming week has been indicated. On Thursday it was heard from the company that it would definitely not be possible to produce here between March 14th and 25th. The expectation is that there could be further absences by April 24th – in this case it was agreed with the works council that further short-time work could be applied for. Production at the Polish sites in Poznan and Wrzesnia will initially be suspended from March 10th.
“The war in Ukraine upsets us all,” wrote Purchasing Manager Murat Aksel, Human Resources Director Gunnar Kilian and Works Council President Daniela Cavallo in a letter to the workforce. “After the Russian attack, Volkswagen is hoping for a quick cessation of hostilities and a return to diplomacy.” CEO Herbert Diess reacted “with great concern and dismay” shortly after the war began last week. The European and World Group Works Councils of VW AG said they were “deeply shaken”.
Central and Eastern Europe are an important sales market for the second largest car company after Toyota. In 2021, all VW Group brands delivered almost 660,000 vehicles there. The core brand VW passenger cars sold around 206,000 new cars in the region last year.
Several car manufacturers are stopping exports
Other car manufacturers also drew consequences from the military escalation. BMW stops building cars in Kaliningrad, Russia, and exporting to Russia. In addition, there will be production interruptions in German and European plants due to delivery bottlenecks, it was said on Tuesday in Munich.
BMW also purchases wiring harnesses from western Ukraine. In 2021, the group built 12,000 cars in Kaliningrad with its Russian partner Avtotor and sold a total of 49,000 cars in Russia. In the largest European BMW plant in Dingolfing, production is likely to be completely canceled in the coming week – short-time work is being clarified.
Mercedes-Benz decided to take similar steps. The Stuttgart-based company is suspending its exports to Russia and production there, as announced on Wednesday evening. Almost three years ago, Mercedes inaugurated its first car plant near Moscow – at that time in the presence of President Vladimir Putin. The production facility, built for more than 250 million euros, offers over 1000 jobs. Starting next week, the shift planning of individual Mercedes plants is to be adjusted. You want to avoid failures as best you can. The world’s largest truck manufacturer Daimler Truck has temporarily suspended its activities in Russia, including its cooperation with the armored car manufacturer Kamaz.
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
