In a significant development, the Russian plant once owned by Volvo AB has recommenced production after a nearly two-year hiatus. Now operating under the name Automobile Motor Company (AMO) and overseen by Industrial Investments Group, the plant has set ambitious plans to manufacture 2,000 trucks in the year 2024.
Volvo’s Strategic Shift: Exit from the Russian Market
The decision to suspend all sales, service, and production in Russia in February 2022 marked a pivotal moment. By October of the same year, Volvo hinted at possible additional write-downs. In 2021, Russia constituted approximately 3% of Volvo’s net group sales, which amounted to about 372 billion Swedish crowns ($36.18 billion). The move was part of a larger trend among Western carmakers responding to Moscow’s invasion of Ukraine.
Amid the Western withdrawal and the intermittent production setbacks in Russia, Chinese car manufacturers have seized market opportunities. Recent data indicates a peak in Chinese car sales at around 50%.
Rebranded and Repurposed: The Former Volvo Plant’s Transformation
Under the stewardship of Industrial Investments Group, the former Volvo plant is undergoing a transformation. The focus is on producing high-capacity trucks with excellent cross-country capabilities, all under the brand name ‘Next.’ The initial production target for the current year is set at 50 trucks, with future plans to diversify the range of vehicles.
The specifics of the plant’s sale to Industrial Investments Group in September have not been disclosed. CEO Andrei Alexandrov has disclosed ongoing discussions with an undisclosed foreign partner, signaling the company’s commitment to further expansion and collaboration on the horizon.
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