Hyundai has been given green light by Russia’s Anti-Monopoly Service to buy General Motors’ plant in St. Petersburg.
On Monday, the anti-trust body said it had approved Hyundai’s possible acquisition of the GM facility. Last month, the Korean automaker’s Russian subsidiary confirmed discussions to purchase the factory but declined to offer further details.
The GM factory in the St. Petersburg suburb of Shushary can build up to 100,000 cars a year. The plant was built in 2008 but closed in 2015 when General Motors decided to reduce its international operations. GM’s investments into the project were estimated at $300 million, with models built there including the Chevrolet Cruze, second-generation Chevrolet Trailblazer, and Opel Astra.
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Interestingly, Hyundai and sister brand Kia already have a factory in St. Petersburg with an annual capacity of more than 200,000 vehicles. The facility builds the Hyundai Creta SUV as well as the Solaris and Kia Rio sedans. Hyundai is reportedly seeking a second plant in Russia to build crossovers, including the popular Tucson.
The Korean carmakers sold more than 400,000 vehicles in Russia last year, more than Russian auto giant AvtoVAZ. During the first half of this year, their combined sales reached 145,071 vehicles in Russia, according to figures from the Association of European Businesses (AEB) cited by AutoNews Europe.
The Russian auto market has been significantly affected by the coronavirus crisis, with new car sales plunging earlier this year. The AEB predicts a full year drop of 24 percent for new-car sales in Russia to 1.34 million.
