Whether you believe in the thin veil that masquerades as democracy or you are content on dealing with dictators then as long as the specific country in question is open for business all should be good and well.
Vladimir Putin’s vision of a strong Russia isn’t being shared by the grim economic reality that has swept the country.
These days true power lies not in the rule of democracy or the vain glory of a dictator it lies in how well the economy is performing. More money means happy days all round.
Mitsubishi and PSA-Peugeot are not enjoying Russia’s current economic climate, the country is tip toeing into a deepening financial crisis which is being driven by a vain-glorious and sometime shirtless dictator.
The two car companies in question have a joint production venture in Russia, a bad economy with rising prices means car sales have been hit hard. The factory is located in the region of Kaluga, around 120 miles southwest of Moscow and will temporarily stop production for two weeks.
Time of course means money, no time means well no money is being made and a closed factory still brings with it associated running costs.
The joint venture produces the Outlander and Pajero Sport SUVs for Mitsubishi and the 408 and C4 for Peugeot-Citroen. The joint production venture was established in 2012, things looked different back then, Russia was expected to become an economic powerhouse.
However Putin’s desire to annex and start a proxy war in parts of eastern Ukraine has left Russia facing sanctions from the international community.
The Kaluga plant has an annual production capacity of 125k vehicles, in the first year only 28k vehicles were made. Currently the Russian market is down by 24 percent, Peugeot-Citroen has seen its sales slump by 75%, Mitsubishi by 36%.