Nissan exits Russia promoting property for 1 greenback

Over 1,000 corporations have made the choice to shut down operations in Russia and go away the nation after the extensively condemned invasion of Ukraine on Feb. 24. 

Months later, the exodus nonetheless isn’t over. On Tuesday, Japanese carmaker Nissan turned the newest to exit the nation, saying a sale of all its remaining Russian property for a largely ceremonial charge.

“On behalf of Nissan, I thank our Russian colleagues for his or her contribution to the enterprise over a few years. Whereas we can not proceed working available in the market, we have now discovered the absolute best answer to assist our folks,” Nissan president and CEO Makoto Uchida mentioned in a press release.

Nissan will dump its Russian property to state-owned Central Analysis and Improvement Vehicle and Engine Institute, also referred to as NAMI, for a token one euro ($0.97) charge, in accordance with Reuters.

The exit from the nation is an costly one, as Nissan is dropping roughly 100 billion Japanese yen in worth, in accordance with the corporate’s assertion, or round $686 million. However the firm will nonetheless have an opportunity to recoup its losses, with a clause allowing the automaker to purchase again its property throughout the subsequent six years.

Nissan didn’t instantly reply to Fortune’s request for remark.

Closing down

In exiting Russia, Nissan is abandoning some useful property, together with a producing facility in Saint Petersburg and a gross sales middle in Moscow. However regardless of their worth, these properties have possible been a burden to the Japanese carmaker for months.

Final March, Nissan briefly halted manufacturing at its Russia plant due to difficulties acquiring elements from exterior the nation. Nissan in whole employed over 2,000 staff in Russia, and in 2021 the Saint Petersburg manufacturing facility produced 45,040 autos, Automotive Information Europe reported on the time. 

The pause was speculated to final solely three weeks however was prolonged in early April as the corporate continued to run into logistical difficulties. The plant has remained idle since then, with the pause having been prolonged one final time in September earlier than the sale to NAMI was finalized.

In a press release, Nissan mentioned that NAMI would deal with “future passenger car initiatives.” The corporate additionally introduced that each one of its employees remaining in Russia would proceed to obtain worker safety advantages for the subsequent 12 months.

Mass exodus

Whereas operations within the nation have been on pause since March, Nissan’s official Russia exit comes months after different automotive corporations determined to go away the corporate.

French carmaker Renault signed an settlement with Russian authorities to promote its property within the nation to NAMI again in Might, additionally with an choice to purchase again its stake throughout the subsequent six years. Renault didn’t disclose how a lot it bought its Russian property for, though the New York Instances reported the charge to be as little as one Russian ruble.

Some carmakers, like Nissan, stored manufacturing on maintain for months however finally determined to shut down operations on account of ongoing difficulties in acquiring elements. Japanese firm Toyota additionally suspended manufacturing in Russia again in March, however introduced to be terminating operations within the nation solely final month.

Many corporations acted shortly by leaving the nation inside a month or two of the invasion, together with German sportswear firm Adidas and meals producer Oetker.

However some took longer to account for the futures of huge workforces nonetheless in Russia. Quick-food chain McDonald’s closed down its over 800 eating places in Russia in March after receiving criticism on-line and from buyers for not exiting the nation sooner. The corporate finally left Russia in Might when it bought off all its property to a Russian purchaser, a choice McDonald’s CEO Chris Kempczinski later advised Fortune had been delicate contemplating the way forward for the corporate’s 62,000 Russian staff.

Join the Fortune Options electronic mail listing so that you don’t miss our greatest options, unique interviews, and investigations.