Siegfried Wolf, an Austrian entrepreneur and member of the supervisory board of Porsche SE, the holding group that owns Volkswagen, has allegedly been in contact with Russian President Vladimir Putin in an effort to revive Russia’s beleaguered automotive industry.
According to a three-page letter obtained by German newspaper Der Spiegel, Wolf proposed a plan to use Volkswagen plants that the company is trying to divest itself from to resurrect the iconic Russian auto brand, Volga.
In the letter that dates back to January, Wolf suggested that the new Volga vehicles would be based on Skoda models, but “completely redesigned externally” to incorporate classic Volga design features.
Read: Volkswagen Reportedly Ending Operations At Russian Nizhny Novgorod Plant For Good
The letter purportedly sent by Wolf recommended a project that would require a substantial 60 billion rouble investment (roughly $735 million at current exchange rates) from Russia, aimed at producing around 270,000 vehicles annually. The project aimed to revitalize the beleaguered Russian automotive industry, which has struggled since facing international sanctions. In exchange, Wolf’s project promised to create or preserve 12,000 jobs. Putin reportedly expressed support for the plan. The project’s operator would be PromAvtoKonsalt, a Russian company that Der Spiegel says is owned by Wolf himself.
While Wolf claimed that he has a “fundamental agreement with the top management of Volkswagen” concerning the proposed deal to revive Russia’s automotive industry, this assertion is now called into question. Volkswagen’s board of directors, speaking to Der Spiegel, stated that they had “no knowledge whatsoever” of the letter or “its irritating contents”.
While PromAvtoKonsalt was one of the prospective buyers for Volkswagen systems in Russia, the company clarified that no commitments were made to individual interested parties before the sale process was completed. Subsequently, Volkswagen announced that the Russian dealer group Avilon Automotive had “met the previously defined criteria as best as possible”. However, the alleged interference by a member of the supervisory board of the company that owns Volkswagen in its Russian dealings is concerning for all parties involved.
More: Russian Court Freezes VW Assets, Throwing Road Block In Automaker’s Escape Route
In the past few months, Volkswagen has encountered legal issues in Russia. GAZ, a company that had contracts with Volkswagen to manufacture new vehicles in Russia prior to the sanctions, has sued Volkswagen twice since March when the decision not to sell to PromAvtoKonsalt was made. These legal disputes have had major repercussions, including the freezing of Volkswagen’s Russian assets and the potential jeopardy of its deal with Avilon Automotive.
Der Spiegel also reports that there have been allegations of collaboration between Schaeffler, an automotive supplier on whose board Wolf also sits, and GAZ since March to prepare for automobile production. However, Schaeffler has denied these claims.
