France’s PSA Peugeot Citroen and Japan’s Mitsubishi are the latest automakers that will temporarily stop production at their joint venture factory in Russia due to the slumping auto sales brought by the country’s worsening economic conditions.
The two auto producers jointly operate the assembly facility, located in Kaluga, 180 km southwest of Moscow, and according to a PSA spokesperson it would cease manufacturing today for two weeks. “It has been planned for a long time and announced in December to the employees,” commented the person. PSA builds the Citroen C4 and Peugeot 408 cars there while Mitsubishi produces the Outlander and Pajero Sport SUVs and all vehicles are assembled from knockdown kits. According to figures coming from the Moscow-based Association of European Businesses in January the sales of PSA vehicles in Russia dived 75 percent to just 898 units. Mitsubishi on the other hand took a smaller loss due to the Japanese yen – it’s weak enough to allow the Asian automakers keep prices a little lower – the automaker saw a 36 percent fall to 3,220 autos during the same period.
So far, the overall sales in Russia have plunged 24 percent, with General Motors and Renault among the other manufacturers that had to suspend output at their local factories in Russia because of the ruble decline and the overall poor state of the country’s economy. PSA and Mitsubishi started operating the factory in Kaluga back in 2012 – when Russia was poised to overtake Germany as Europe’s largest auto market by sales.
Via Automotive News Europe