Renault will temporarily halt production at the Avtoframos plant in Moscow for the duration of May as demand in the Russian market remains very weak, according to a Vedomosti report. Renault will introduce the stoppage in order to attempt to stop the build-up of inventory of unsold vehicles after demand for the Renault brand fell a further 15% year on year (y/y) in Russia in the first quarter of this year, in a wider light-vehicle market that fell by 16.9% y/y during the same period.
Significance: Despite the Renault brand's Russian sales falling by just 1% y/y in March, which was a far better performance than the overall 10% y/y decline in the market in March, Renault has still opted to put its workers on furlough and halt production at the Avtoframos plant, which currently builds the Duster, Logan, Fluence and Mégane. As the Russian market collapsed in 2015 as a result of currency issues, sanctions and falling energy prices, production at the Avtoframos plant declined from 143,536 units in 2014 to 60,247 units in 2015.
