While the car alliance between Renault and Japan’s Nissan appears to be suited to ride the wave of political tension surrounding Russia and Ukraine, the company is still assessing the Western sanctions.

As well all know by now, the crisis in Ukraine has brought European Union and United States sanctions against Russia, accused of inciting local tensions and fraudulently adding territorial parts of the neighboring country.

More so, for the French Japanese alliance, among the restrictions and sanctions, some were set against the deputy chairman of OAO AvtoVAZ, a Russian automotive company that is majority controlled by Renault-Nissan.

“We are still studying the sanctions regime and exactly what it means for Renault,” said one of the company’s lawyers.

“There is a lot of scenario planning right now, and the risk profile has taken a step change,” also said one auto analyst at a Moscow firm.

Besides the threat of even bigger economic sanctions, the foreign carmakers implicated locally in Russia need to navigate the shallow waters of the country’s declining economy, which led last year to a decline in sales, after a few very good years. LMC Automotive, after previously previewed a 2-4% contraction for this year, a full crisis with Ukraine could lead to the market collapsing by 15-20%.

Via Reuters


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