Japanese car maker Nissan announced on Tuesday that it will sell its Russian operations for a token sum of €1 (about R17.60) to NAMI, Russia’s Central Research and Development Automobile and Engine Institute.
The car manufacturer said it will take a hit of about ¥100-billion (R12.47-billion) from this exit and that the sold business will operate under a new name.
“On behalf of Nissan, I thank our Russian colleagues for their contribution to the business over many years. While we cannot continue operating in the market, we have found the best possible solution to support our people,” said Nissan president and CEO Makoto Uchida in a statement.
Uchida further said the terms of the sale would allow Nissan the option of buying back the entity and its operations within the next six years.
The writing was on the wall that the car manufacturer would disinvest from Russia after it suspended production at its St Petersburg factory following Russia’s invasion of Ukraine.
Nissan joins other multinational companies that have either exited or are relooking at their business relations in the eastern European country.
In March, a German sportswear giant warned that closing all of its 500 stores in Russia would have a greater impact on sales than anticipated.
British American Tobacco said it was exiting its Russian business, while Philip Morris, the cigarette maker, has suspended planned investments and will reduce manufacturing in Russia. Unilever, which owns big brands including Dove and Sunsilk, has suspended imports and exports from and to the country.
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