Car sales in Russia continue to fall in 2020

In 2020 the fall of the Russian car market continues to forecast sales of about 1.72 million vehicles, which is 2.1% less than in 2019, stated at the annual conference of the Association of European businesses (AEB), the head of the automobile manufacturers Committee Joerg Schreiber.

In 2019, the Russian car market fell by 2.3%, according to AEB. Last year was harder than we thought in the beginning, says Schreiber: after the increase in VAT from 2019, the decline was expected, but hopes for a recovery in the second half did not materialize.

2020 will also be difficult, predicts Schreiber: “market Participants have reached a ceiling in demand, without stimulating growth is impossible”. According to Schreiber, businesses need an open dialogue with the government, and while there is no clear information on the approach to the development of the industry from the state.

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Russian dealers of optimism even less. The fall of the car market in 2020 can reach 10%, the fear of the Chairman of the Board of the group “Avilon” Andrey Pavlovich. The market could fall by 8-10% agree with him Director of development of the company “Rolf” Vladimir Miroshnikov. According to Pavlovich, in this situation, the industry will not save you from falling even government support – such as the program “First car” and “Family car”.

the Analyst of “VTB capital” Vladimir Bespalov considers that in 2020 the Russian car market will remain at last year’s level or even increase to 5%. This, in his opinion, may occur due to the growth of the economy, state support measures, as well as the low base effect in 2019.

Demand falls because of lower incomes, says Miroshnikov. In 2019 the market has decreased even during the operation of state programs, he recalls: for cars with a price dabout RUB 1 million, where there are state programs, and pent-up demand is exhausted. And on the machine for 1-2 million rubles., Miroshnikov continues until there is significant pent-up demand, but it can not be realized due to the lack of state support.

According to Pavlovich, the demand is negatively affected by higher prices of cars from January 1, partly because of the growth utilsbora, partially due to seasonal price increase. About the price increase at the end of 2019 announced Volvo (+1.1% in average in the lineup) and BMW (2% new). Mazda also has raised prices in Russia in December, said Schreiber (he is also the CEO of Mazda Motors Rus). Prices for Suzuki rise in January, said the General Director of “Suzuki motor Rus” Yuta Takahashi.

All of this will be in the hands of domestic “AVTOVAZ” says Bespalov. Increase utilization fee on cars from January 2020, AVTOVAZ is virtually no impact, he notes: fee is paid by all, but the local automakers in contrast to the importers receive comparable costs of these subsidies from the Federal budget, it will allow them to be more flexible in pricing.

Some dealers are unable to close the saloons because of the loss, if the industry will not stop uncontrolled sales, not only critically reduce the margin business and reducing the prestige automotive brands, says Pavlovich.