GM is cutting production and halting expansion at its Russian plant
General Motors announced on Thursday that it will be reducing production at its manufacturing plant near St. Petersburg, as well as reviewing the timing of the plant’s planned expansion, due to the continued slowdown of the Russian automotive market.
The plant currently manufactures the American automaker’s Chevrolet Cruze, Opel Astra, and Chevrolet Trailblazer models. General Motors opened the $300 million plant back in 2008, and had planned to launch the second stage next year. Now, according to a company spokesman, the plant will only operate on four days in August, another four in September, and then eight in October.
“In view of the current business situation in Russia and the lower sales volumes since the start of the year, we are taking a close look at our plans. As part of this, we are also reviewing the timing of our expansion plans at the GM Auto Plant in St Petersburg,” the General Motors spokesman said.
Car sales have been faltering this year in Russia as the country’s economic growth has slowed. Sanctions from Western countries on Russia because of its involvement in Ukraine has also damaged consumer sentiment. The Association of European Businesses (AEB) noticed that cars from General Motors were hit especially hard by the slowdown.
Read more about the story at Reuters.