Chery automaker to quit Russia to avoid sanctions
Chinese automobile concern Chery plans to leave the Russian market by 2027 – something the company must do to avoid sanctions and float its shares on the Hong Kong stock exchange. This was reported by Japan's The Nikkei newspaper on 17 September.
Company documents cited by the newspaper show that over the next two years, the company will "gradually reduce the number of existing brands and sales channels in Russia. By that time, Russian sales as a percentage of total revenue will become "insignificant". The carmaker had also announced that, starting late 2024, it "ceased transactions with Iran and Cuba" in order to "mitigate sanctions risks".
Reuters noted earlier that Chery's upcoming IPO could be the largest among automakers in Hong Kong this year. According to Bloomberg, Wall Street banks are refusing to participate in the IPO while the automaker is actively selling in Russia.
According to The Nikkei, the automaker plans to raise $1.2 billion through the sale of shares, and intends to use these funds largely to develop and expand its range of electric and hybrid cars.
Chery's Russian subsidiary, however, denied the news about the brand leaving the market. "The Chery brand is not leaving the Russian market," the company's press service told TASS. One Chery dealer in Russia explained that what is happening is a rebranding, with the replacement of the entire lineup already taking place now. "Chery is not leaving Russia, it is being rebranded, all the company's obligations to Chery customers remain, all the programmes – warranty, service, support, spare parts – remain, and everything is being transferred to the new Tenet brand," he said in an interview with Business FM radio station.
Chery vehicles have been sold in Russia under the Tenet brand since this year. Tenet is a Russian brand, but all three models currently on the market (crossovers T4, T7 and T8) are re-branded versions of Chery Tiggo vehicles. They are assembled at a plant in the Kaluga region where Volkswagen was produced until 2022.
The Russian market is Chery's second largest after China, and accounted for 25.5% of the company's total revenue in 2024. The automaker became one of the most popular in the country after the withdrawal of Western brands in 2022.
In first quarter 2025, more than 210 Chinese car dealerships closed in Russia due to the loss of investors, which is three times more than a year earlier, RBC reported. However, still having 206 showrooms, Chery remained number one among foreign vehicle dealerships.