MOSCOW (Reuters) -Japan’s Toyota Motor (NYSE:) Corp has decided to close its plant in Russia, Russia’s Ministry of Industry and Trade said in a statement.
The automaker suspended production in St Petersburg in March due to supply chain disruptions and stopped vehicle imports into Russia.
Toyota will ensure the fulfilment of all social obligations, as well as significant additional pay-offs to the staff, the ministry said, and will retain after-sales service of Toyota and Lexus cars and maintain its dealer network.
Russia’s Kommersant newspaper first reported the plans, citing unnamed sources, earlier on Friday.
The factory, which has a capacity of 100,000 units a year and produced the Camry and RAV4 models, will be preserved and may be sold in the future, Kommersant’s sources said.
The ministry and regional authorities are working on possible scenarios to develop the site, the ministry said.
Toyota did not immediately respond to a request for comment.
Many factories in Russia have suspended production and furloughed workers due to shortages of high-tech equipment and an exodus of Western manufacturers after Moscow sent armed forces into Ukraine on Feb. 24.
(reporting by Reuters; editing by Kevin Liffey, Jason Neely)