Siemens deliveries & work on new projects in Russia grind to a halt

Siemens deliveries & work on new projects in Russia grind to a halt

Europe’s largest industrial manufacturing company, Munich-based Siemens said on Wednesday it would suspend its business in Russia following Moscow’s offensive in Ukraine. The company, which produces and services trains and supplies software and industrial equipment, said it would “put all new business in and international deliveries to Russia on hold” while it assesses the effects of sanctions imposed on the country by Western states over the past week.

Russia accounts for a mere 1% of Siemens’ global sales, but the firm’s train-making unit, Siemens Mobility, has an agreement with Russian Railways to build high-speed Sapsan trains. The current contract for 13 trains is in the works, with the trains scheduled to be produced within two years, while the first brand new Sapsan was delivered to Russia last summer. The order for the trains is worth around $1.22 billion, and the partnership includes a 30-year maintenance contract. While the order itself now seems to be in jeopardy, Siemens did say it would continue to honor its service and maintenance commitments for the time being.

Siemens’ announcement comes a day after German luxury carmaker BMW said it was halting sales in Russia, as well as exports of car parts to the country. Previously, Mercedes-Benz Group said it was halting its partnership with Russia’s Kamaz truck maker.

However, a number of German companies represented on the Russian market said this week they would stay in the country despite sanctions. These include pharmaceutical group Bayer, household chemicals manufacturer Henkel, and store company Metro.

For more stories on economy & finance visit RT's business section

Source: www.rt.com

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