Volkswagen’s Russia Pull Out Hits Legal Roadblock - Report
Volkswagen’s efforts to completely wind down operations in Russia has hit a legal roadblock with a Russian court freezing the assets in the country. VW had been one of several automakers to suspend operations in Russia last year with the company in more recent months looking to sell off its assets in the country. However,
as per a report, the planned sale of assets has hit a legal stumbling block following a lawsuit filed by Russian auto manufacturer GAZ which had contract-manufactured VW vehicles till the contract was terminated last year.
VW Group plant in Kaluga, Russia.
As per court filings, GAZ has said that VW’s attempt to exit the Russian market has put the former’s interests at risk and seeking $ 201.3 million in damages over the terminated contract. The lawsuit has also called for a halt on any sale of assets by the German company. The court has, as of Monday, ordered a freeze on any sale of assets by VW till the legal matter is concluded.
VW reportedly said that it was surprised by the lawsuit with the contract having been terminated on ‘mutually agreed terms’. The company also said that it was looking into the lawsuit.
The company also said that it was in the process of applying to Russian authorities for the approval of sale of its stake in VW Group Russia to a Russian investor. The sale would include a plant in Kaluga – the location of VW’s flagship production facility in Russia – as well as the transfer of over 4,000 employees.