Chinese carmakers move into abandoned Russian factories

Russia’s invasion of Ukraine nearly three years ago led to many Western brands pulling out of the country due to sanctions and political pressure. That left a huge gap in the market for everything from cars to fast food, but those gaps have been filled by domestic and international options.

One of the biggest winners appears to be Chinese automakers, with Reuters reporting that brands from the People’s Republic of China account for more than 50% of new car sales in Russia. This booming demand has reportedly led to companies taking over factories once owned by Western automakers.

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Citing five people familiar with the matter, the publication said Chery is now producing cars at Russian factories that had been abandoned by Mercedes, Nissan and Volkswagen. However, the role in the production process appears to be rather limited, as Reuters said the factories are used for final assembly as the cars arrive “almost complete”.

The move may be a way to circumvent tariffs, as the publication reports that Russia is imposing higher fees on imported vehicles. Chery is said to control nearly 20% of the passenger car market, so final assembly in China could be a way to secure its foothold.

It is said that these factories produce Tiggo and Exeed models, among which Tiggo 7 was renamed Xcite X-Cross 7. While it’s unclear how much assembly work is actually done in Russia, Italian authorities recently fined DR Automobiles for “importing ‘finished’ cars” from China. Officials there released photos of rebadged Chery vehicles, noting that they were “complete and complete in every respect.”