A mysterious company has resumed production of Citroën C5 Aircross at the former Russian Stellantis factory, with the help of Chinese manufacturer Dongfeng. The French manufacturer claims to have lost control of the site, and finds itself powerless in the face of this affair which mixes economic and geopolitical interests.
The citroen.ru website has all the appearance of an official manufacturer website. In the “cars in stock” section, it announces that 96 “Russian” Citroën C5 Aircrosses are currently available for sale. However, neither this site nor these cars displaying the chevrons of the French brand have anything to do with Stellantis, the group resulting from the merger of Peugeot-Citroën and Fiat-Chrysler. The war in Ukraine, international sanctions and Kremlin policy have freed Russia from the rules of the global economic game and make possible such acts of industrial piracy that seemed unthinkable until recently.
To understand how this became possible, we have to go back to April 2022, two months after Russia’s invasion of Ukraine. Stellantis then announced the shutdown of its Kaluga factory, 200 km southwest of Moscow, due to “the logistical difficulties encountered on a daily basis” and “in order to guarantee full compliance with all sanctions”. explains the group. Overnight, this site (of which Mitsubishi holds 30%) designed to produce 125 000 vehicles per year, employing 2 700 employees, is emptying, like most other automobile factories in Russia.
Russians determined to make car manufacturers pay for their departure
Unlike Renault, which will quickly, in May 2022, sell (for the symbolic ruble) its stake in Avtovaz-Lada and its factory in the suburbs of Moscow to the Russian authorities, Stellantis is unable to sell off its assets in the country. “They were less well integrated into the system than Renault”, analyzes a posteriori a Frenchman living in Moscow, a fine connoisseur of industrial environments. Stellantis continues to cover employees’ salaries initially, but the group makes no secret that it has no intention of returning to the Russian market, where it has never really made a breakthrough. “The Ministry of the Economy has taken the departure of foreign car manufacturers very badlycontinues this Frenchman, he was determined not to give them any gifts.”
For Stellantis, this means giving up on the Kaluga factory, which the group now admits has “lost control”, without any transfer having ever been formally recorded. For almost two years, no one heard anything more about this ghost factory, until March 27, when a Russian company, Automotive Technologies, announced the start of “series assembly of Citroën C5 Aircross crossovers” on the Kaluga site, which seems not to have been lost to everyone. The new operator announces the arrival of the first models in dealerships for May 2024. Buyers can already reserve them on the Citroën Russia website, which also seems to have changed ownership.
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According to our information, the production of these vehicles, as well as the support functions, are carried out by former employees of Stellantis in Russia, but no one knows exactly who is behind this company. “Officially, this is the former Citroën distributor in Russiaexplains a Russian journalist, who would have invested alone to restart the factory. On paper it is possible, others mention the presence of a big investor but this is only speculation., continues this automobile specialist, who was able to visit the factory during a press visit to which no foreign journalists were invited. Automotive Technologies did not respond to franceinfo’s questions.
A factory tour that leaves many questions unanswered
This visit, which some journalists filmed, allowed us to see what this new production looked like made in Russia. Guided by the development director of Automotive Technologies, Pavel Bezroutchenko, the journalists were able to observe the assembly of the first vehicles in a half-deserted factory. “Obviously, we weren’t sure that we were being presented with the whole realitycontinues our journalist. There remain, even after this visit, large gray areas.. The Kaluga C5 Aircrosses are assembled from kits of 1 700 pieces imported into Russia. This method is called CKD (for complete knock down) in industry. The bodies arrive by train already welded and painted in Kaluga. Workers put all the pieces together and the car officially becomes Russian. But who supplies these parts which make it possible to assemble an original Citroën? ? This day of the visit, Pavel Bezrushenko refused to tell the journalists who asked him the question. We just know that these vehicles are identical to those marketed in France, with the exception of a few details, such as the front lights.
The “accomplice” is not, however, very difficult to find. This is Dongfeng, the Chinese manufacturer, shareholder of Stellantis, partner of Peugeot and Citroën in the production in China of 4008 (Chinese version of the 3008) and… C5 Aircross in particular. Dongfeng Motor did not respond to franceinfo’s questions, but a source at Stellantis confirms that the group has written to its Chinese partner “to tell him that he did not have the right to export these parts to Russia.” According to Reuters, Dongfeng initially exported 42 C5 Aircross kits to Russia. Others must have been since then, with Automotive Technologies announcing its intention to increase the production rate, capping for the moment at “two or three vehicles per day” by his representative’s own admission.
“A great geopolitical ball”
“All this remains highly symbolic and it’s a big geopolitical balldeciphers a good connoisseur of the sector. This allows us to display good understanding between Russians and Chinese, and the governor of Kaluga can proudly announce that the factory is running.” This operation necessarily received high-level political approval in Moscow and Beijing, several sources confirmed to us. Dongfeng is owned by the Chinese government and Pavel Bezrushenko is the former deputy director of the automobile department of the powerful Minpromtorg, the Russian Ministry of Industry and Trade. He was even decorated in this capacity in 2018, by decree of Vladimir Putin. The new “owner” of the Kaluga factory does not seem afraid of the prospect of sanctions due to his actions. Questioned on the subject by Russian journalists, he claimed to have “a plan B, and even a plan C.”
In this context, how can we nevertheless explain the lack of virulence that Stellantis seems to show in the face of this obvious spoliation of its rights? ? “It’s all about the balance of powerexplains an industry consultant. If you feel that you are being robbed, you go to court. But does Stellantis really want to get angry with the Chinese government over what it expects from this market? ?” Especially since the romance between the Chinese manufacturer, which came to the aid of Peugeot-Citroën in great difficulty in 2013, and the group which has become Stellantis since the merger with Fiat-Chrysler seems to be ending. Dongfeng recently sold part of its Stellantis shares, and bought back the factories it co-owned in China. As for considering legal recourse in Russia in the current context…
The new face of Russia in 2024
As symbolic as the production of the Kaluga factory may be, this affair is above all representative of the new reality into which Russia has fallen, after having long sought to display its respectability concretized in particular by its accession to the WTO (World Organization of trade) in 2012, after 18 years of tough negotiations. After having fought for a long time against counterfeiting, the country now lets cinemas show “pirated” American films, due to lack of a license, and aligns itself with practices that are current in Iran, for example, where we already find Peugeots manufactured without the authorization of the French manufacturer. On the streets of Moscow, European cars are gradually disappearing in favor of Chinese models, all imported. Chinese manufacturers are reluctant to invest in the country despite the “limitless” cooperation touted by their respective leaders.