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Ukraine Russia War: Mercedes-Benz’s billion-dollar asset hangs in Russia, the company also fears cyber attacks

The ongoing Russo-Ukraine war could threaten the assets of Germany’s leading carmaker Mercedes-Benz (Mercedes-Benz) worth more than 2 billion euros (about 1 trillion 68 billion rupees). The carmaker has said that a proposal by the Russian authorities to nationalize their assets in case foreign companies leave the country would be a major blow to the carmaker. Mercedes-Benz is one of several global auto makers that have their manufacturing plants in Russia, and have halted imports and exports of vehicles with the country amid Moscow’s invasion of Ukraine. 

Mercedes Benz Car Plant Russia
Mercedes Benz Car Plant Russia – Photo: Mercedes Benz
Mercedes-Benz released its annual report on Friday, saying the ongoing war in Ukraine poses a range of risks, from parts shortages to power supplies or even cyber attacks. “These risks could be exacerbated by a possible seizure of the assets of the Russian subsidiaries,” Mercedes-Benz said.
Russian President Putin
Mercedes-Benz’s reaction comes days after Russia’s ruling party United Russia threatened to nationalize foreign automakers. Russia’s ruling party has said a government commission has approved the first step towards nationalizing the assets of “unfriendly” firms in which foreign ownership is more than 25 percent.

Mercedes-Benz GLC Coupe
Mercedes-Benz GLC Coupe – Photo: Mercedes-Benz
Last week, Mercedes-Benz also joined other foreign carmakers that have decided to halt exports to Russia. “Mercedes-Benz is suspending the export of passenger cars and vans to Russia, as well as local manufacturing in Russia, until further notice,” the carmaker said in a statement. Mercedes-Benz partner Daimler Truck also said it would suspend its business activities in Russia, including its collaboration with Russian truck maker Kamaz. 
New honda city
New honda city
Last month, several carmakers decided to suspend operations in Russia in view of the ongoing conflict between Ukraine and Russia. Car makers like Volvo, Ferrari, Honda, Toyota, Volkswagen, General Motors, Jaguar Land Rover, Mercedes-Benz, Ford and BMW have not only suspended their operations but have also banned the export of their vehicles in the country. . 

Mercedes Benz Car Plant Russia
Mercedes Benz Car Plant Russia – Photo: Mercedes Benz
Mercedes-Benz has a manufacturing plant in Acipovo, near Moscow, where it produces the E-Class sedans and SUVs. There are about 1,000 employees in this plant. The plant was inaugurated in April 2019. Russian President Vladimir Putin attended the opening ceremony of the plant. Putin had said the plant would produce 25,000 cars a year with an investment of about $300 million (about Rs 23 billion).
Mercedes offers 25 models in Russia which includes C-Class, E-Class, S-Class, V-Class, AMG and Maybach. The company also offers electric cars like EQE and EQS.
Mercedes-Benz said that its Russian assets, which were valued at 2 billion euros (about 1 trillion 68 billion rupees) by the end of 2021. Also, banks have a liability of about 1 billion euros (about Rs 83 billion 77 crore), for which the carmaker has issued a global guarantee. 
Mercedes’ manufacturing plant near Moscow is the first plant in Russia to be opened by a foreign carmaker after years of nearly drying up foreign investment in the Russian auto industry amid Western sanctions and a stagnant economy.
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