Mercedes-Benz has announced its withdrawal from the Russian market and confirmed readiness to enter into an asset sale agreement with Avtodom, the prominent Russian auto dealer. After regulatory clearance, the parent factory in the Moscow region, its own network of dealerships, a bank, and associated financial structures are set to come under the new ownership umbrella controlled by the buyer group.
According to Natalya Koroleva, who leads the Russia division, the negotiations centered on securing reliable service for Russian customers and preserving access to essential financial services in the transition. Her remarks were included in the company’s official communication.
Koroleva emphasized that protecting the jobs of Mercedes-Benz employees in Russia remained a primary objective as the agreement was being shaped.
Reuters notes that the 15 percent stake in KamAZ held by Mercedes-Benz will remain unaffected by the deal and will be transferred to Daimler Trucks during the current year.
The Ministry of Industry and Trade indicated that the new owners of Mercedes-Benz Russia could invite additional production partners to collaborate on the assets.
Avtodom stated to socialbites.ca that further steps in the agreement would be announced once the deal reaches completion.
Avtodom added that the group will actively pursue options to maintain service and maintenance for Mercedes-Benz vehicles that are sold and operated within the Russian Federation.
Construction of the Mercedes-Benz plant in the Esipovo technopark within the Moscow region began in 2017, with the first vehicles rolled off the line in the spring of 2019. The facility is designed for a full production cycle of about 20,000 units annually, featuring welding and body painting.
The E-Class sedan was the debut model produced for the Russian market, followed by the assembly of the GLC, GLE, and GLS sport utility models. Executive S-Class sedans were previously imported from Germany. In the spring of 2022, local automobile production was halted.
Analysts believe that resuming Mercedes-Benz manufacturing in Russia in the near term appears unlikely given ongoing sanctions. Still, there is speculation about Chinese partners supplying car kits to the facility.
One analyst suggested the deal could resemble a buyback arrangement seen in past transactions, such as Renault and Nissan, where a token price enables future buyback rights. The company faced the reality that producing vehicles locally could become financially untenable if losses persist, noted a Vesti FM radio commentator.
The possibility exists that the facility may adopt a model similar to earlier plans by Motorinvest, where Chinese-supplied car kits are assembled in Russia, branded with a local name, and sold. Such a strategy would minimize exposure for the foreign supplier while enabling local production at reduced risk. Expert commentary also highlighted the Moskvich brand as a potential vehicle line under a reconfigured approach. Yet market conditions suggest that the Russian auto market has contracted significantly, which weighs against a broad restart of large-scale domestic production.
One observation pointed out that the equipment at the Esipovo plant was originally configured to assemble Mercedes vehicles. Reconfiguring for different models would require adjustments to welding and assembly lines, and if the existing paint line remains compatible, a partial retooling might be feasible.
Sergey Udalov, managing director of the Avtostat analytical agency, noted that Mercedes-Benz owns substantial real estate in Russia and holds a stockpile of unsold vehicles. He highlighted the component warehouses and a training center near the Moscow Ring Road, along with a flagship dealership on Leningradsky Prospekt, all of which could be attractive for a potential new owner. He suggested that unused vehicles might represent a valuable asset for the new operator.
Udalov added that a capable technology partner could enable rapid reconfiguration of equipment and possibly initiate production of other vehicles at the Moscow region plant within about a year. Still, he expressed doubt that Mercedes-Benz would jeopardize sanctions to supply components for the plant or entrust operations to an external party without careful assessment.
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