Chinese automaker Chery Automobile plans exit from Russia by 2027 amid sanctions pressure

The reason is that the company wants to list on the Hong Kong Stock Exchange, placing shares worth $1.2 billion there. The funds will be used to expand its lineup of electric and hybrid vehicles, with an additional 20% invested in overseas operations.

However, due to the sanctions imposed on Russia, the company may face problems, something Chery effectively confirmed in its official share prospectus. It stated that the company aims to ensure "sanctions and export controls compliance," which is why it is withdrawing from the Russian market.

Russia is Chery's second-largest market. In 2024, one in five cars purchased in Russia was from this brand, with a total of 325,200 vehicles sold. Also, in 2024, 25.5% of Chery's total revenue was from Russia, compared to 17.7% in 2023.

Currently, Chery operates 372 dealerships and 687 showrooms in Russia. The company began scaling back operations in April, when its Russian subsidiary announced the transfer of assets to three unnamed companies. The exit will be fully completed by 2027.

At the same time, according to Russian media, Chery's office in Russia was quick to claim that it would not completely leave the country. The office manages four brands in Russia — Chery itself, as well as Exeed, Omoda, and Jaecoo.

Meanwhile, Gregor Sebastian, a senior analyst at Rhodium Group, told the Japanese publication that if Chery's decision is implemented, it will be a huge turnaround.

The decision is influenced not only by Western sanctions but also by Kremlin actions. Recently, Russia introduced new recycling fees on imported cars, effectively targeting the Chinese manufacturer. As a result, doing business in Russia is becoming unprofitable, making it more advantageous for Chery to sell cars in the European Union.

New sanctions against Russia

Meanwhile, on September 13, US President Donald Trump stated that the United States is ready to impose serious sanctions against Russia, provided that all NATO countries stop buying Russian oil.

He called on NATO countries to introduce tariffs on China in the range of 50–100%, which could be lifted after the war in Ukraine ends. Trump also criticized Europe for not being "tough enough" on sanctions against Russia and for continuing to purchase Russian oil.

At the same time, it became clear that the European Commission may not present the 19th package of sanctions against Russia on the planned date of September 17. The issue has been removed from the agenda for now. It is reported that the new package will be presented later, after coordination with the G7 countries.