General Motors Beats a Retreat Out of Russia
World Economy

General Motors Beats a Retreat Out of Russia

General Motors is to slash production in economically troubled Russia and pull the Opel brand completely in the face of shrinking sales, AP reported Wednesday.
Mass-market GM brands have been among the biggest losers as Russia’s auto market shrinks, with sales of Chevrolet down 74 percent year on year in February and those of Opel plummeting 86 percent.
Opel will leave the Russian market, with Chevrolet production cut back significantly to focus on top-end products such as the Corvette sports car and Tahoe SUV.
In a statement, GM president Dan Ammann said the move “avoids significant investment into a market that has very challenging long-term prospects.” GM’s factory in St. Petersburg will “halt production by the middle of 2015,” the company said.
The ruble has lost nearly half its value against the dollar since the beginning of last year. Russia’s gross domestic product fell by 1.5% in January from the year-earlier period, and an important manufacturing index reached a five-and-a-half year low. Consumer price inflation hit 16.7 percent in February, with a 23.3 percent jump in food prices. Putin has warned of economic pain that could last as long as two years.
The result is the kind of economic uncertainty Russians haven’t seen since a brief period in 2008-09, and before that in the 1990s, when the Soviet Union’s collapse brought hyperinflation and financial collapse. European and American investors are growing wary. A top Bank of Russia official said Monday that the central bank was considering halting currency trading on the Moscow exchange in the event of excessive volatility.


Short URL : http://goo.gl/HuwbEs

You can also read ...

Riyadh Going After  Non-Arrested Princes
Political analyst Jamal Khashoggi has said that Saudi Arabia...
Wage growth in Australia has fallen  dramatically in recent years.
The Reserve Bank of Australia says relentless cost cutting by...
No Sign Philippines Economy Overheating
The chief of the Bangko Sentral ng Pilipinas said the...
Shadow financing is seen as one of the culprits behind China’s property-price surge, and regulators have banned  private-equity lending to developers for land purchases.
China’s drive to reduce its debt burden has shifted into a...
China’s Tencent Overtakes Facebook in Market Value
China’s social media and video game giant Tencent overtook...
Confidence in Afghanistan’s Future Rising Slowly
Afghanistan’s economy is expected to grow 2.6% this year, up...
Malaysia Growth Robust
Malaysia’s economy should continue to grow at a decent pace...
The global economy is enjoying a strong and broad-based recovery, and will grow even faster in 2018.
The robust health of the global economy has received...