Hyundai Motor's plant in Saint Petersburg is seen in this undated photo. The plant was renamed as AGR Automobile Plant after it was sold to a Russian company. Yonhap

As the talks toward a truce between Russia and Ukraine are gaining momentum, major Korean companies are accelerating their feasibility studies on resuming business in Russia. The move comes as Russia is seen as a critical market for diversifying business interests, especially amid growing tariff pressures from the United States.

The talks for ending the war are picking up speed after the U.S. on Tuesday (local time) reached limited ceasefire deals with Ukraine and Russia, respectively, halting long-range strikes on energy infrastructure.

If the two countries reach a complete truce or peace agreement, sanctions on Russia will likely be lifted, allowing Korean firms to resume business there.

With a population of over 140 million, Russia is a significant market with a strong preference for Korean products and serves as a strategic hub connecting Central Asia and Europe. According to data from the Ministry of Foreign Affairs, bilateral trade between Korea and Russia reached $29.9 billion in 2021, with Russia ranking as Korea's 12th-largest export market at the time.

Among major Korean firms, LG Electronics is making a swift move. According to industry officials, LG Electronics partially resumed operations at its electronic appliance plant in Moscow of late.

"The move is aimed at preventing deterioration of production facilities that have been idle since the outbreak of the war," an LG official said, adding that "the operation uses inventory materials at the plant." Before the war, the plant manufactured washing machines and refrigerators.

LG Electronics CEO Cho Joo-wan said Tuesday that the company is still "cautious because the war has not reached its end," but added that "we are closely monitoring the situation because we may resume operation when sanctions are lifted."

The remarks were interpreted to show that the company is now preparing for a possible resumption of operations there in the near future.

HD Hyundai Electric, which has been maintaining its Russian business through the war, will participate through a local distributor in Electro 2025, Russia's largest electrical exhibition, scheduled for April 1 to 4, in an apparent move to exploit the high demand for restoring power infrastructure damaged by the war.

Hyundai Motor Group is also busy studying the feasibility of the post-war Russian market. Hyundai Motor and Kia were Russia's top two car brands in 2021, but the group sold its plant in Saint Petersburg in December 2023 for 10,000 rubles ($120) under a clause allowing it to buy back the plant within two years. This means that the group must decide whether to resume its Russian plant by the end of this year.

Regarding the issue, a Hyundai Motor Group official said, "No decision has been made, and the company is closely monitoring the progress of the situation."

Apart from Hyundai Motor, its affiliates Kia, Hyundai Mobis, and Hyundai Steel have recently posted job openings in Russia, signaling greater chances of the group resuming business in Russia.

Samsung Electronics' plant in Kaluga, Russia, is seen in this Feb. 21, 2010, file photo. Korea Times file

Samsung Electronics is also reviewing the feasibility of resuming its Russian business.

Samsung Electronics suspended operations at its Russian factory in Kaluga in 2022, which produced 1 million TVs, monitors and washing machines a year. The company has been maintaining its outlets in the country through parallel import, but has not been producing products in Russia and reportedly leased some of its manufacturing lines to local companies after the invasion began.

In February, a Russian newspaper reported that Samsung's marketing expenses from January to February this year increased 30 percent from the same period a year earlier.

While Korean firms are ramping up efforts to reenter the Russian market, they face significant challenges as Chinese competitors have expanded their market share during the war.

According to market tracker StatCounter, Xiaomi's market share in Russia stood at 20.93 percent as of February, following Apple with 29.21 percent. Samsung Electronics remained at No. 3 with 17.31 percent.

Russian analytical agency Autostat also showed that Chinese manufacturers collectively accounted for 62 percent of Russia's car market in 2024.

"The Russian market remains a market of significant importance to Korean companies, so any kinds of efforts to resume business are likely to follow once the war ends," a conglomerate official said.

"The key issue, however, is that it remains uncertain which sanctions will be lifted during peace negotiations and how Korean firms can regain the market share that Chinese companies have expanded."