As tensions between the United States, China, and Russia reshape the global order, China’s Chery Automobile is expanding its influence in Russia by utilizing former Hyundai and General Motors (GM) plants to produce vehicles under its subsidiary brand, Jaecoo. This development highlights the potential for increased geopolitical complexity as President Donald Trump adopts a hardline stance on China.
According to industry sources on January 21, Jaecoo recently began production of its flagship SUV model, the J7, at the AGR plant in St. Petersburg. This facility, sold by Hyundai Motor to AGR Automotive Group in December 2023 for approximately 1,000 rubles (around $100) under a buyback agreement allowing Hyundai to repurchase the plant by December 2025, is now being repurposed for Jaecoo’s operations.
The J7 is being manufactured using the Disassembled Knock-Down (DKD) method, where completed vehicles are disassembled for export and reassembled locally. To support this, Jaecoo has converted a nearby Glovis warehouse for parts storage, and over 100 units had already been produced as of January 18.
This plant was previously a key global production hub for Hyundai, with an annual capacity of 230,000 vehicles. However, Western sanctions and geopolitical instability following Russia’s invasion of Ukraine have forced many automakers to exit the Russian market, creating opportunities for Chinese brands to fill the void.
Chery Automobile is also preparing to activate another facility in St. Petersburg, formerly operated by GM. This plant, sold alongside the Hyundai factory in 2023, is expected to be used for producing vehicles under Chery’s premium brand, Qoros. While specific details have not been disclosed, industry experts anticipate that this move will further expand Chery’s presence in the Russian automotive market.
“With Jaecoo now producing the J7, it’s highly likely that the second AGR plant will focus on Qoros vehicles,” an industry analyst said. “Chery is well-positioned to significantly increase its market share in Russia.”
This development comes at a time when the Trump administration is expected to adopt a more confrontational approach toward China. In his inaugural address, President Trump emphasized prioritizing American manufacturing and countering China’s economic influence, which could lead to heightened scrutiny of Sino-Russian partnerships. Chery’s expansion into Russia illustrates how China is capitalizing on opportunities created by the withdrawal of Western companies from volatile markets.
The ultimate outcomes of Chery’s ventures in Russia remain uncertain, but they clearly demonstrate how China is leveraging opportunities arising from Western disengagement. As the United States recalibrates its foreign policy under President Trump, the dynamics of global trade and power are set to evolve in unpredictable ways.
