Nissan Motor and Renault have stopped taking orders for some cars in Russia and could raise prices on others if the ruble’s plunge continues, alliance chief executive Carlos Ghosn said.
“We have suspended taking orders,” Ghosn told Reuters at Nissan’s headquarters in Yokohama, saying the freeze was limited to specific models while orders already placed are being honoured.
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“We didn’t do it (suspend orders) overall, just on some models we said, ‘Sorry, until we see where this situation is going we don’t take orders’.”
The news agency noted Russian currency has tumbled about 50% against the dollar so far this year putting pressure on automakers who have had to raise prices and contend with falling demand.
Nissan has already increased prices on half of models sold in Russia by 5% to 8%, the report said. Ghosn told Reuters Nissan had hiked prices on models that use higher levels of imported parts.
Russia is Nissan’s fifth-largest market and the alliance with Renault, of which Ghosn is chairman and CEO, gives the automaker a majority stake in Avtovaz, Russia’s largest automaker.
Ghosn, who told the news agency Nissan and Renault were gaining market share in Russia, wants to grow their combined market share there to 40% from about 35% now.
He said he remained confident that the Russian market would “stabilise”. Nissan this month announced plans to double production capacity at its St Petersburg plant to 100,000 vehicles.
“The bad news is that the market is shrinking. This is bad news for everyone,” Ghosn told Reuters.
“When the rouble sinks it’s a bloodbath for everybody. It’s red ink, people are losing money, all car manufacturers are losing money.”
Reuters noted the automaker aims to raise production in Russia to 90% of Nissan cars sold in the country by 2016, up from the current 70%.
Ghosn also praised Japanese prime minister Shinzo Abe’s mix of economic and fiscal policies at the briefing, the Reuters report added.
He said the now much weaker yen was no longer a “handicap”, and the company planned to take advantage of the currency’s drop and expand domestic production for export.
