Otis elevators rethinks business in Russia over Ukraine war
FARMINGTON, Conn. (AP) — Elevator manufacturer Otis Worldwide Corp. announced Monday it is reevaluating its future in Russia amid the ongoing war in Ukraine.
In an earnings conference call with industry analysts, Otis Chief Executive Judith Marks said the company was disheartened by the conflict’s escalation and is exploring “alternatives for our Russia business that are in the best interests of all of our stakeholders.”
“We have growing concerns about the long-term sustainability of Otis’ operations in Russia, especially with mounting regulations and supply chain disruptions,” as well as sanctions against Moscow, she said.
The West has moved to cut off Russia’s access to its foreign reserves, limit imports of key technologies and take other restrictive actions. More than 300 companies have pulled out, and international supply chains have largely shut down after container company Maersk, UPS, DHL and other transportation firms exited Russia.
Marks said Otis would exclude Russia from its financial results and forecasts for the time being.
She said Otis is now “evaluating the best ownership structure for the business, whether that’s with us or somewhere else.”
The Farmington, Connecticut-based company said its operations in Russia represented approximately 2% of its 2021 revenue, based mostly on new equipment sales.
“We remain hopeful for return to peace and stability in the region and we will continue to contribute to the ongoing relief and humanitarian efforts necessary for those most impacted by this crisis,” Marks added.
In March, Otis announced it would not take new elevator and escalator orders in Russia and not make new investments in the country “for the time being.”