Why Mother Russia Is Too Mother F-cking Crazy For GM


Russia will always be Russia.

Earlier this month at Geneva, Fiat Chrysler CEO Sergio Marchionne's words were "thank God" his company had limited exposure in Russia. As you're probably already aware, the Russian economy and currency are currently tanking due to Western sanctions stemming from the Ukraine situation and dropping oil prices. The Russian currency, the ruble, is rapidly losing value, causing consumers to pretty much not buy anything unnecessary, such as new cars. In addition, there are now increased prices for automakers to import parts.

Essentially, doing business in Russia is now ridiculously expensive. GM has just announced that it will end production by the middle of this year at its St. Petersburg plant which produces the Chevrolet Cruze and Trailblazer, and Opel Astra. 1,000 jobs will be lost. By next December, Opel will be out of Russia. Assembly of mass-market Chevrolet cars at the GAZ plant will also end. Only four years ago, GM was preparing to expand its Russia operations, calling the country "an important strategic market." In the near future, GM will only focus on the premium segment, like importing Cadillacs and some US-built Chevys. So was that whole Russian invasion of Ukraine worth it, business-wise? For GM, the answer is clear.

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