Volkswagen property in Russia frozen by court docket following lawsuit by Gaz, an automaker

The plans of Volkswagen, the German automobile producer, to withdraw from Russia have hit a snag after a court docket suspended its property within the nation whereas awaiting a lawsuit.

Gaz Group, owned by Oleg Deripaska, a sanctioned oligarch, filed a lawsuit towards VW because the latter desires to terminate their collaboration that was imagined to final till 2025. VW had contracted GAZ, the Russian auto producer, to supply Volkswagen automobiles at its Nizhny Novgorod manufacturing unit.

Final yr, Volkswagen and different international carmakers needed to halt their operations in Russia after western nations imposed unprecedented sanctions on Moscow over the battle in Ukraine. VW has since been attempting to promote its Russian property, together with its flagship plant in Kaluga, which had a workforce of over 4,000 individuals and a manufacturing capability of 225,000 automobiles yearly.

GAZ argued in court docket that Volkswagen’s resolution to exit the Russian market is placing its personal pursuits in danger and is searching for damages price 15.6 billion roubles ($201.3 million) over the terminated contract. In the meantime, a Russian court docket froze all of Volkswagen’s property within the nation to await the decision of the lawsuit, additional complicating the scenario as VW tries to wind down its operations in Russia.

Volkswagen’s Russian subsidiary stated it was stunned by the lawsuit and their partnership had “ended on mutually-agreed phrases”.

“We’re conscious of the declare from GAZ and are familiarising ourselves with the case supplies,” it stated in an announcement to Reuters.

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