VW’s Skoda in final stages of exit from Russia

In the twilight of its presence in Russia, Volkswagen AG’s Skoda is in its final stages of departure from the country’s automotive market.

As the German carmaker winds down its presence in Russia, the move is being seen as a blow to the nation’s auto sector, which is already struggling to fill the void left by the exodus of foreign carmakers.

Skoda, a Czech carmaker owned by Volkswagen Group, has been a mainstay of the Russian car market for more than two decades. But the company’s Russian arm has been on the decline in recent years, with sales of its vehicles dropping from a peak of 80,000 in 2017 to just over 30,000 in 2019 – a 61.3% decrease.

The writing has been on the wall for some time, with Volkswagen Group announcing in 2018 that it would be ending the production of Skoda vehicles in Russia. The move has been attributed to the ongoing economic crisis in Russia and the weakening of the ruble, which has made it increasingly difficult for foreign carmakers to compete in the local market.

The exit of Skoda from Russia is also a reflection of the broader trend of foreign carmakers leaving the country. In recent years, carmakers such as Ford, GM, Renault and Peugeot have all departed the Russian automotive market, citing a variety of economic and political factors.

The departure of Volkswagen’s Skoda from Russia will undoubtedly have a negative impact on the nation’s auto sector. With fewer foreign carmakers in the market, local carmakers will have less competition, leaving them to face a weaker consumer base and a highly competitive market.

Nevertheless, there is still hope for the Russian auto sector. Despite the challenges it faces, the industry is still growing, with some local carmakers, such as AvtoVAZ, enjoying success in recent years.

Only time will tell if the Russian auto sector can weather the storm and fill the void left by the departure of Skoda.