Apple halts product sales in Russia, increasing pressure from carriers and automakers amid Ukraine crisis

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Major American brands including Apple, Google, Ford and Harley-Davidson halted sales on Tuesday and distanced themselves from Russia over the invasion of Ukraine, joining a growing list of companies from truckers to automakers to energy companies doing the same avoid country. Apple said it has stopped selling iPhones and other products in Russia, Alphabet Inc.’s Google has removed Russian state publishers from its news, Ford Motor has informed its Russian manufacturing partner that it is ceasing operations in the country, and Harley-Davidson Inc .set up his shops and deliveries on his bikes.

Earlier in the day, the world’s largest shipping companies, MSC and Maersk, suspended container shipping to and from Russia, deepening the country’s isolation.

The West has imposed severe restrictions on Russia to isolate its economy from the global financial system, urging companies to halt sales, cut ties and divest tens of billions of dollars of investments.

“We are deeply concerned by the Russian invasion of Ukraine and stand by all people suffering from the violence,” Apple said in a statement announcing a sales pause in Russia and other measures, including Apple’s cap and shutdown Pay the ability to download RT News outside of Russia.

The steady drumbeat from companies taking a stand intensified later in the day as rockets hit major cities in Ukraine.

“Ford is deeply concerned by the invasion of Ukraine and the resulting threats to peace and stability. The situation has forced us to reassess our operations in Russia,” Ford said, adding to the multi-day announcements by global automakers.

Nike has not made purchases of goods available on its website and app in Russia because it cannot guarantee the delivery of goods to customers in the country, an update on the sportswear maker’s website showed on Tuesday.

The moves by MSC and Maersk mean that Russia — the world’s 11th-largest economy and supplier of one-sixth of all commodities — is now effectively cut off from much of the world’s shipping capacity.

To stem the rush, Moscow said on Tuesday it would temporarily bar foreign investors from selling Russian assets, but energy companies BP and Royal Dutch Shell have already decided to divest their Russian operations, while leading banks, airlines, automakers and others are doing their business Deliveries have been cut and partnerships have ended.

Austria’s Raiffeisen Bank International (RBI) is considering leaving Russia, two people with knowledge of the matter told Reuters, a move that would make it the first European bank since the invasion.

Mining and commodities group Glencore said it is reviewing all operations in Russia, including stakes in EN+ and Rosneft.

“The corporate world is building a fortress to isolate Russia from the international community,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

Energy companies have been at the forefront of Russia’s rejection, and on Tuesday French oil and gas group TotalEnergies said it would stop providing capital for new projects in Russia.

Paramount Pictures became the latest Hollywood studio to halt theatrical distribution in Russia, announcing Tuesday it would pause releases of upcoming films The Lost City and Sonic the Hedgehog 2.

financial pariah

In a matter of weeks, Russia has gone from a lucrative bet on rising oil prices to a financial pariah, with a central bank paralyzed by sanctions, big banks locked out of the international payments system, and capital controls choking off cash flows.

US payment card companies Visa and Mastercard have blocked several Russian financial institutions from their network.

Major car and truck makers including Volvo Cars, AB Volvo, General Motors, Harley-Davidson and Jaguar Land Rover have also halted exports to Russia. BMW said it was ceasing local production and car exports to Russia.

Finnish telecoms equipment maker Nokia joined competitor Ericsson in saying it will halt shipments to Russia to comply with sanctions.

The Switzerland-based company that built the Nord Stream 2 gas pipeline from Russia to Germany is considering filing for bankruptcy, two sources familiar with the situation said, as it seeks to settle claims ahead of a US sanctions period.

The company, Nord Stream 2 AG, did not comment on a possible bankruptcy.

The United States has restricted exports of tech hardware, including computers, sensors, lasers, navigation tools, telecommunications, aerospace and marine equipment, prompting many tech companies like Dell Technologies Inc to suspend sales in Russia.

The big US tech companies are juggling calls to shut down services in Russia with what they see as a mission to give a voice to dissent and protests.

“Clear and clear”

Some pro-government US investors have been vocal about expectations of companies, with Connecticut Treasurer Shawn Wooden saying he would direct state pension funds to sell Russian assets.

“We need to send a very clear and unequivocal response that California will not condone Russia’s aggression,” California Treasurer Fiona Ma said Monday, declaring her support for the divestment of Russian assets from state pension funds.

Russia is calling its actions in Ukraine a “special operation” designed not to occupy territory but to destroy and capture its southern neighbor’s military capabilities, which it sees as dangerous nationalists.

Airlines are gearing up for protracted blockades of east-west flight corridors after the EU and Moscow enacted airspace bans affecting an estimated 20 percent of the world’s air freight.

© Thomson Reuters 2021


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