Ukraine war: Russia nationalises Renault's Moscow plant

The French carmaker said it would sell its 68% interest to a Russian science institute, while its shares in Renault Russia will go to the city of Moscow. Moscow said Renault's Russian assets had now become state property.

It is the first Russian nationalisation of a major foreign business since the invasion of Ukraine. "Agreements were signed on the transfer of Russian assets of the Renault Group to the Russian Federation and the government of Moscow," Russia's industry and trade ministry said.

The deal also included Renault's Moscow plant, Avtoframos, which makes Renault and Nissan models. Moscow mayor Sergei Sobyanin said production at the plant would now resume under the Soviet-era Moskvich brand.

Renault boss Luca de Meo said: "Today, we have taken a difficult but necessary decision; and we are making a responsible choice towards our 45,000 employees in Russia, while preserving the group's performance and our ability to return to the country in the future, in a different context."

The agreement, which Renault said would cost the company an estimated €2.2bn ($2.29bn), includes an option for the group to buy back its interest in Avtovaz for six years.

Avtovaz is Russia's largest carmaker and makes the country's popular Lada brand. In March, Renault announced it was suspending operations at its Moscow factory. It came after Ukraine's President Volodymyr Zelensky called on Renault and other French companies to leave Russia, accusing them of "financing the murders of women and children".

Hundreds of international brands including Starbucks, Coca Cola, Levi's and Apple have left Russia since the country invaded Ukraine in February, with many now looking to sell their businesses in the country. Moscow has previously warned it may nationalise production plants or factories where work has been suspended.