Daimler starts Mercedes-Benz plant near Moscow, Putin attends the ceremony

German automaker Daimler formally opened a Mercedes-Benz factory near Moscow on Wednesday at a ceremony attended by Russian President Vladimir Putin, marking a foreign investment into Russia’s auto industry.

The plant in the town of Esipovo 40 kilometers north west of Moscow is the first in years to be started by a foreign automaker in Russia where investment into the once proliferating auto industry dried up because of western sanctions and a stagnant economy.

Speaking at the inaugural ceremony, Putin stated the plant would produce 25,000 cars annually and that investment in the project had amounted 19 billion roubles ($291 million).

Daimler CEO Dieter Zetsche, and German Economic Minister Peter Altamaier were also present in the ceremony.

Putin stated the factory, constructed after Daimler signed a deal with Russia’s officials in early 2017, would hire nearly 1,000 people.

Most global automakers started their plants in Russia in the first half of the 2000s, but after peaking in 2012 car sales dropped to a ten-year low of 1.42 million in 2016. The market is recovering again, and a total of 1.8 million cars were sold in 2018.