No decisions have been reached and other possibilities could emerge, the people said. How Renault’s wholly-owned factory in Moscow would fit into the plan is unclear as yet. The French automaker would be unable to make the transfer of its 68 percent stake in AvtoVAZ to the other shareholder, Rostec State Corporation, because the Russian partner is under sanctions, they said.
Renault last week halted operations at its Moscow plant and said it was assessing available options for AvtoVAZ. The manufacturer valued the business in Russia -- its second biggest market -- at 2.2 billion euros ($2.4 billion), including goodwill, at the end of last year.
Russian authorities said last week that they would make a decision on the future of the AvtoVAZ venture by the end of this week.
The decision put Renault among a growing list of companies pulling back from Russia after President Vladimir Putin invaded Ukraine.
Lada makes Russia’s two best-selling cars, the Vesta and the Granta, and has about 22 percent of the local market. Renault got about 10 percent of its revenue from Russia last year and AvtoVAZ had a profit margin of 8.7 percent, far higher than the 0.6 percent achieved by the group’s automotive division without the venture, according to its latest annual report.
As car factories in Russia struggle to produce vehicles due to a lack of imported parts, the venture will start burning through cash. In 2021, AvtoVAZ paid out 393 million euros in payroll costs, the report said. Net financial debt stood at 597 million euros.
Renault last week revised downward its financial outlook for this year on the Russia decision and said it would lead to a writedown in the first-half earnings statement for the value of the Russian business.
