Renault's majority control of AvtoVAZ, the Soviet-era maker of Ladas, and reliance on Russia for about 12 percent of its revenue are now matters of investor concern.
Cutting ties with the venture would come at a tremendous cost, and prospects for a broader economic slump across Europe risk derailing its already-tenuous turnaround efforts.
"It would be perfectly legitimate for Renault to consider an exit from AvtoVAZ," said Jefferies analyst Philippe Houchois. "Renault could take the loss, but an exit would be a tough decision."
Russia accounted for about 5 billion euros ($5.5 billion) of Renault's revenue last year, and roughly 315 million euros of operating profit could be at risk, Bloomberg Intelligence estimates. Renault shares have plummeted since last week to trade at their lowest since November 2020.
As a flood of companies worldwide pull back and unload assets in Russia, Renault, and the French government -- its most powerful shareholder -- have kept mum on AvtoVAZ. So has the other partner in the venture, Rostec State, a Russian government-owned defense conglomerate headed by Sergey Chemezov, a close ally of Putin.
"Renault has promised to abide by sanctions," Gabriel Attal, the French government spokesman, said Thursday on France Info radio. A spokesman for AvtoVAZ declined to comment beyond operational issues. Renault continues to monitor the situation, according to a spokesman.