GM to suspend St. Petersburg output as Russia ruble weakens

Article by Christian A., on February 2, 2015

General Motors will temporarily stop output at its St. Petersburg assembly site in Russia from mid-March to mid-May and is hiking product prices due to the weak Russian ruble that is eating its profits. The site is home to the Russian production of the Opel Astra and Chevrolet Cruze, according to the Automotive News Europe Guild to Assembly Plants in Europe.

The St. Petersburg site is the only plant that GM fully owns in Russia. GM also operates a joint-venture site in Russia with AvtoVAZ. GM has already raised prices for its vehicles sold in Russia due to the currency, a spokesman for GM Europe said. He, however, could not confirm a report by Kommersant that prices have surged an average of 20 percent in the last two months.

In 2014, GM saw its sales in Russia decline 26 percent to about 258,000 vehicles, according to data from the Association of European Business (AEB) – sharper than the 10-percent drop posted by the industry to 2.49 million.

AEB expects auto sales to further dive this year to 1.89 million, a figure regarded as too optimistic by many carmakers. Another American carmaker, Ford Motor, has lowered its forecast for its European operations this year, citing the weak Russian ruble and economy as major culprits.

Ford had expected its losses in Europe to drop from $1 billion in 2014 to $250 million this year. But the situation in Russia prompted Ford to expected losses more than $250 million.

"We expect to see a big headwind from Russia in 2015," Chief Financial Officer Bob Shanks. He said that they expect the overall vehicle in sales in Russia to be at sub-2 million units.

Topics: gm, russia, production

If you liked the article, share on:

Comments

Recommended

Another day, another record. Is the new Dodge Challenger SRT Demon the fastest car to date? According to some sources, the Dodge Challenger SRT Demon had just beaten the Tesla...
by - April 24, 2017
Following in the footsteps of the McLaren 570S, 540C and 570GT is the newest addition to the McLaren Sports Series -- the roofless 570S Spider. McLaren 570S was rolled out...
by - April 24, 2017
The British automaker Lotus is noted for releasing low production, limited editions of its sports car lineage. Now the Hethel-based automobile manufacturer is back at it again with its latest...
by - April 24, 2017
Earlier this week, the revamped 2018 Mercedes-Benz S-Class was revealed ahead of the 2017 Shanghai Auto Show. As expected, Mercedes Benz’s flagship model is now offered in several variants including...
by - April 24, 2017
Well, this is clearly not good news for everyone. Ever since the new BMW M4 CS rolled out in Shanghai last week, several reports about its limited production have quickly...
by - April 24, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries