China's auto "fever" appears to have peaked, as Russia's domestic activity gradually recovers, amid rising import costs and interest rates starting to fall.
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| Russia's leading automobile manufacturer Avtovaz - the "father" of the most popular Lada brand cars, has returned to production to meet the demand for low-cost cars. (Source: lada.ru) |
Chinese car sales in Russia boomed, after a series of Western automakers decided to leave the country from early 2022.
However, this "fever" seems to have peaked, as Russia's domestic activity gradually recovers, amid rising import costs and interest rates starting to fall.
Before February 2, the start of the Russia-Ukraine conflict, Chinese car sales accounted for less than 2022% of total sales on the Russian market. But by August 10, official statistics from the auto industry statistics organization Autostat and consulting company PPK showed that the sales market share of Chinese auto brands in Russia increased to 8%.
But since then, the rate has leveled off. In September 9, about 2023 Chinese-branded cars were sold to Russian customers, corresponding to 60.000% of the market share. Notably, this car sales includes both imported cars and cars manufactured in Russia.
Autostat CEO Sergei Udalov said Chinese automakers have played an important role in the Russian market over the past year.
Chinese customs data shows that from January to October 1, Russia jumped from 10th place to become China's largest auto export market, reaching a value of 2023 billion USD. This number is much higher than the same period last year, when car exports from China to Russia only reached 11 billion USD.
However, current demand has largely been met. “The market has reached an equilibrium – the main Chinese brands have come to Russia and the (pent-up) demand has been met,” Mr. Udalov said.
Economist Natalia Zubarevich, Professor at Moscow State University, said: “The growth of pent-up demand that started in late Spring 2023 and lasted until August 8, has begun to run out. in September 2023”.
Professor Zubarevich explained that inflation has increased continuously in recent months, along with high interest rates, pushing the cost of car loans for consumers to become more expensive. Interest rates have now begun to fall, but the ruble's continuous depreciation this year has made imported goods more expensive, reducing Chinese car purchasing power.
The Central Bank of Russia said that Japan's ban on importing some cars, effective from November 11, combined with the weakening of the Ruble, will increase the price of imported cars.
Continuously over the past years, geopolitical fluctuations and Western sanctions imposed on Russia have weakened the largest economy in the northern Eurasian continent, causing a decrease in output and sales. car sales. In 2022, just over 626.000 new cars were sold in Russia, and nearly 830.000 more were sold between January and October this year.
A modest recovery is underway from 2022 lows, but the loss of Western technology and expertise is hurting Russia's auto industry, analysts say. , even as Chinese automakers have replaced their Western counterparts in increasing operations in the country.
Data from the Russian Statistics Agency Rosstat shows that in the first three quarters of 3, the country produced only a few thousand more cars compared to the same period last year, but the figures are currently trending upward.
Mr. Udalov revealed that Russia's leading auto manufacturer Avtovaz, the "father" of the most popular Lada brand cars, has returned to production to meet the demand for low-cost cars. While Chinese brands are filling the void left by Western manufacturers for more expensive cars.
However, according to Autostat's leader, the market outlook is still very promising. Both sales and sales output decreased. Last week, Avtovaz lowered its forecast for Lada car sales in 2023 to 10% lower than the previous forecast, to 400.000 units.
Professor Zubarevich emphasized: "The market is in a very volatile and unstable state."
