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Toyota shuts Russian factory over supply chain issues

Agency Report
Agency Report

Toyota announced Friday it was closing its assembly line near Saint Petersburg, in a new example of supply chain problems dogging firms operating in the sanctions-hit country.

The industrial site spanning over 224 hectares (554 acres) suspended production in March, shortly after the start of Russia’s military operation in Ukraine.

“Toyota has decided to stop production at the Toyota Motor plant in Saint Petersburg,” the company said in a statement.

“After six months at a standstill, the company does not see a realistic possibility of restarting production in the future.”

The Japanese carmaker was forced to close the plant due to major disruptions in the “supply of electronic parts”, the main business daily Kommersant newspaper said Friday, citing sources in the company.

Russian President Vladimir Putin attended the opening of the site in 2007.

It employed around 2,600 people and produced around 80,000 cars Camry and RAV4 models last year, according to numbers given to AFP in March.

Toyota car sales collapsed by 69 per cent in Russia between January and August to 19,000 cars, according to the Association of European Businesses (AEB).

But Russian sales are only a very small fraction of Toyota’s global revenues.

Western sanctions imposed on Russia since the beginning of the Ukraine offensive have heavily disrupted supply chains.

The technology and car manufacturing sectors were particularly affected.
AFP


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