Russians switch to used cars as sanctions hit auto sector | – #Russians #switch #cars #sanctions #hit #auto #sector
MOSCOW, February 17 (Reuters) – Car With the industry feeling the full force of Western sanctions over the conflict in Ukraine, production is falling, prices are rising and buyers are switching to cheaper used models. car industry spent on new cars in Russia last year more than halved.
While analysts continue to debate the overall effectiveness of economic restrictions on Russia, there is no doubt that they are heavily dependent on foreign manufacturers and imported parts. car hit the industry hard.
Last year, spending on new cars fell by 52% to 1.5 trillion rubles (20,4 billion dollars), the number of new cars sold decreased by 58.8%. Car production also fell to its lowest level since the collapse of the Soviet Union in 1991, as Western automakers shut down production and sold off factories.
Total spending on new and used passenger cars is down by more than 15% in 2022, as inflation prices increased and lowered living standards, data from the Autostat analytical agency shows, despite a 14% increase in spending on used cars.
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The data shows that used cars will account for almost three-quarters of all cars sold, up from 55% in 2021.
As production declines, prices As prices rise, Russians turn to used cars
Sergey Udalov, CEO of Autostat, told Reuters that “second-hand cars prices increased, money flowed into the second-hand car market, while the structure of the new car market changed significantly.
“Budget Ladas and Chinese cars with a price of 2 million rubles and more remain there, and premium brands have almost completely left,” he said.
According to statistics agency Rosstat, last year was 11.9% annually inflation caused the real disposable income of Russians to decrease by about 1%. Retailers have invested heavily in discount store formats, a trend mirrored in the automotive sector.
Anton, an employee of a major Russian company who declined to give his last name, bought a used Skoda in December, preferring a Western-made car over a domestic or Chinese-made alternative.
At 2.5 million rubles, its Skoda model was about 1 million rubles more expensive than a year ago, but still 1 million rubles cheaper than the new version.
Anton said he was happy to pick up a low-mileage foreign-made used car because it was out of stock.
“With the exception of a Lada or a Chinese car, a new car is now just a luxury for the rich,” he said.
According to Autostat, the average price of new cars sold last year increased by 17% to 2.33 million rubles, and the average price of used cars increased by 32% to 890,000 rubles.
Czech carmaker Skoda Auto, which is part of Volkswagen ( VOWG_p.DE ), has said deliveries to Russia will drop by 80% in 2022. Volkswagen has closed factories in Russia and stopped imports, but like some of its peers, it has not yet agreed to sell.
France’s Renault ( RENA.PA ) majority stake in Russia’s Avtovaz Russia sold to the state for only one ruble, but with a 6-year option to buy it back. The same government buyer later bought the assets of Nissan (7201.T) for one euro.
Imports of used cars increased last year, and those from Japan were the leaders. Japan has restricted the export of high-value cars to Russia, but used cars imported by individuals remain exempt from the restrictions.
Western migration has allowed Chinese brands to grab market share. In a high-profile case, engine parts from China’s JAC are being used to revive a Soviet-era Moskvich.
Market analysts expect new car sales to rise to 800,000 this year from 687,370 in 2022, but still well below the 1.6 million sold in 2021.
($1 = 73.5500 rubles)
Report by Gleb Stolyarov; Written by Alexander Marrow Edited by Mark Potter
Our standards: Thomson Reuters Trust Principles.
2023-02-17 10:30:54
Source – reuters
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