After a sharp downturn due to sanctions in 2022, the Russian auto industry recovered in 2023.
According to Deputy Prime Minister Denis Manturov, the auto industry recovered quickly from Western sanctions last year, with vehicle production reaching 720,000 units, up 16% compared to 2022.
In 2022, the Russian auto industry saw a sharp decline in production of 67% and in sales of almost 60%. These results were even worse than in 2020, when anti-pandemic restrictions forced many dealerships to close for extended periods.
The industry, which relies heavily on foreign investment and equipment, immediately ran into trouble when international automakers left after Western sanctions. Several American, European and Japanese automakers withdrew or suspended production or deliveries of parts and cars to Russia indefinitely.
However, domestic manufacturers have begun to overcome the difficulties. According to Mr. Manturov, government measures to boost domestic demand for cars have contributed to the recovery of the industry.
Some car models that Lada is selling. Photo: Lada
Data from Russia’s Autostat analytics agency shows that new car sales in 2023 will reach 1.06 million units, up 69% from the same period in 2022, but still below the 1.51 million recorded in 2021, before the conflict in Ukraine broke out. In December, new car sales were up 110% year-on-year.
Chinese cars are filling the void left by their Western rivals. The market share of “Made in China” cars also appears to have peaked at over 56%, while domestic Russian cars are recovering. Lada remains the best-selling brand with a market share of over 30%.
This year, Autostat forecasts sales to rise 18% to 1.25 million units. In an optimistic scenario, sales could rise as much as 32% to 1.4 million units. Conversely, a pessimistic scenario sees sales falling to one million units.
Autostat head Sergei Tselikov said Chinese automakers and local manufacturers would meet growing demand by 2024. "Chinese manufacturers expect to sell up to 2 million cars in Russia and people want to buy them too," he said.
Tselikov added that factories that have been idle since Western manufacturers left following the Ukraine conflict are also likely to restart operations this year.
Phien An ( according to RT, Reuters )
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