Toyota to stop production in Russia

TOKYO—Toyota Motor Corp. announced plans to end production at its St. Petersburg plant and suspend sales to Russia.

Seven months after the Russian invasion of Ukraine, the auto giant decided there was no prospect of resuming operations in the country.

Toyota plans to begin the process of selling the buildings and land instead of transferring operations to other entities, the company said Friday.

Toyota suspended plant operations in March because it was unable to source parts due to supply chain disruptions, but it ‘made sure the plant was ready to restart production if circumstances permit.

The automaker has retained its workforce and continued to pay salaries, but now plans to start arranging severance packages and offering re-employment assistance as long as the local subsidiary has sufficient funds.

“Even if we were to continue, we would not be able to produce vehicles like Toyota,” the automaker’s operations manager Jun Nagata said in an online interview.

“In terms of financial support for our employees, it was the right time to [halt operations]. It was a really difficult decision.

Toyota is present all over the world, especially in Europe and North America.

With growing global condemnation of Russia, it’s possible the company took its corporate image into consideration when making the decision to halt production.

Toyota is the first Japanese auto giant to announce such plans. Nissan Motor Co., Mazda Motor Corp. and Mitsubishi Motors Corp. will probably also have to decide whether or not to continue their activities in the country.

Toyota will withdraw from production and sales, but will provide repairs and other services to owners of Toyota and Lexus vehicles if parts can be purchased in Russia.

Its operations in Moscow will be reduced and restructured.

Toyota began production of the Camry model in Russia in 2007. In 2021, the St. Petersburg plant was producing around 80,000 units, less than 1% of Toyota’s global production.

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