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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Hyundai Motor Company has decided not to exercise its buyback option for its former St. Petersburg manufacturing plant, effectively eliminating the possibility of re-entering the Russian market, according to industry sources.
The buyback option, which expired on January 31, had allowed Hyundai Motor to repurchase the plant within two years of its sale. Although negotiations were held with Russian counterparts ahead of the deadline, the company ultimately chose not to proceed with the repurchase.
Hyundai Motor experienced rapid growth in Russia following the completion of the St. Petersburg plant in 2010, rising to the top spot in market share in 2021, just before the outbreak of the Russia–Ukraine war. However, the conflict forced the automaker to effectively suspend its local operations.
In late 2023, Hyundai Motor formally exited Russia, selling the St. Petersburg plant to a local company for 10,000 rubles (approximately KRW 140,000). The sale agreement included a buyback option exercisable within two years, with the deadline set for the end of January 2026.
Industry observers attribute Hyundai Motor’s decision to the prolonged Russia–Ukraine war and ongoing Western sanctions, which continue to cloud the outlook for the Russian automotive market. Another key factor cited is the rapid expansion of Chinese automakers during Hyundai’s absence. Vehicles are reportedly being produced at the former Hyundai facility by Jaecoo, a brand under China’s Chery Automobile group.
While Hyundai Motor has opted not to repurchase the plant, the company plans to continue providing customer support services in Russia, including vehicle maintenance and after-sales service.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
