The idle Hyundai Motor Manufacturing Rus (HMMR) plant in St. Petersburg has begun stamping parts, welding and painting bodies for the Hyundai Solaris. This was reported to Vedomosti by two sources familiar with the activities of the enterprise. But these bodies are not intended for Russia – the Korean company sends them to its plant in Alma-Ata (Kazakhstan) to assemble cars there.
According to one of the interlocutors, the line for the manufacture of bodies in St. Petersburg was restarted “recently”. Another notes that the company also plans to produce bodies for the Hyundai Creta crossover.
Until 2022, Hyundai was one of the most massive manufacturers of foreign cars on the Russian market. In 2021, 234,000 vehicles rolled off the conveyor of the Korean concern’s plant in St. Petersburg, of which 71,000 each are Solaris and Creta models. The rest of the volume fell on Kia Rio. At the end of 2021, vehicles manufactured at the HMMR plant began to be equipped with locally assembled engines.
The enterprise suspended its work in March 2022 due to the CBO and subsequent difficulties with the logistics of components. During the year, many foreign automakers left Russia. In the fall of 2022, Nissan announced its withdrawal from Russia and transferred the plant to FSUE NAMI, subordinated to the Ministry of Industry and Trade, later Toyota closed its site. Thus, HMMR remained the only company producing foreign cars in St. Petersburg. The plant has repeatedly extended downtime, the last one is valid until the end of 2022. In December, the company began to gradually reduce employees. The total strength of the HMMR team before the reductions was about 2,500 people.
The representative of the plant declined to comment, Vedomosti sent questions to the Ministry of Industry and Trade and Severstal, which is one of the main suppliers of autosheets for the enterprise of the Korean concern in Russia.
HMMR has previously supplied Russian-made products to Hyundai Trans Kazakhstan (an assembly plant of a Korean company in Alma-Ata – Vedomosti). For example, in 2021, exports to neighboring countries from the plant in St. Petersburg amounted to a total of 24,000 vehicles, 16,000 of which were shipped as vehicle kits for assembly at a site in Alma-Ata.
The full launch of the Hyundai Trans Kazakhstan plant with a production capacity of 30,000 vehicles per year took place in October 2020. It produces seven Hyundai models: Accent (Solaris), Elantra, Sonata, Creta, Tucson, Santa Fe and Palisade. In August 2022, the company suspended the production of Accent and Creta due to the termination of the supply of components for them from the Russian HMMR plant and began to negotiate with Hyundai on an emergency quota for the supply of components from other countries.
The production of bodies at Hyundai’s Russian plant should not be seen as a sign that the company has decided to stay in Russia, says Sergey Burgazliev, an independent auto industry consultant. According to him, the company earns incomparably less from the manufacture of bodies than from finished cars. “As far as I know, Hyundai has not yet made a final decision regarding the Russian site. In light of the current situation, the concern may wait another year. I do not believe that they will completely restart the plant in 2023,” the expert added.