The VW plants in Nizhny Novogorod or Kaluga are not currently operational.
Since the invasion of Ukraine on February 24, Russia’s automotive industry has been in a pause. Virtually all major manufacturers have left the country or stopped local operations. Volkswagen is no exception. Volkswagen is trying to minimize financial damage and offers pay-offs for employees who leave VW.
Reuters reports the automaker is in negotiations with its workers at the Nizhny Novorod car plant, offering financial compensation as well as medical insurance up to the end of the year. After Volkswagen announced that production in Nizhny Novgorod would cease until further notice in March, around 200 workers at the factory received compensation. According to available information, employees who agreed to leave the company by June 17 will receive six months salary.
Volkswagen operates two production plants in Russia. The German manufacturer does not own the one in Nizhny Novgorod. Instead, it has an agreement with GAZ Group, a local automaker. The Volkswagen Polo, Taos, Skoda Kodiaq and Karoq were all produced by Volkswagen Group. However, the production lines were shut down shortly after the Russian invasion of Ukraine. VAG also has a Kaluga plant that employs approximately 4,200 people.
Russian automaker Volkswagen isn’t the only one having problems with Russia. Renault had to sell its controlling share in AvtoVAZ, and the facility it used to operate is now under control of Moscow City. Rumours abound about the possibility of a revival of Moskvitch (an ex-Soviet-era automaker). Even wildest speculation suggests that the brand could be revived as an electric vehicle manufacturer.
Mitsubishi, Ford and Suzuki were among others to cease operations in Russia. Due to Western sanctions, most of these companies have stopped producing or importing cars into Russia.