Leopard in Shanghai: why the government is against cheap cars for Russians
May 16, 2023
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The recently completed 2023 Shanghai Motor Show in China raised the hopes of many domestic experts that Russian importers would win a bunch of contracts there to supply
The recently completed 2023 Shanghai Motor Show in China raised the hopes of many domestic experts that Russian importers would win a bunch of contracts there to supply many brands of high-quality and, most importantly, not very expensive cars from the Middle Kingdom to our market. The AvtoVzglyad portal found out why it is difficult to hope for this under the existing legislative and fiscal system in Russia.
For example, many experts in the Russian car market do not take into account that the “trick” of Shanghai car dealerships is “specialization” in electric vehicles, drones and other innovations in the automotive industry. And the Russians are clearly not ready for these groundbreaking things now: we would have more modern, but cheap cars with traditional internal combustion engines. The Russian car business clearly had nothing to “catch” at this motor show. And in general, the domestic request for a car “cheap and cheerful” sounds somewhat out of pocket for Chinese industrialists.
The fact is that now in China the average salary in the country (!) Is at the level of 110,000 rubles per month (if converted from yuan). And only here in Moscow such a patch is considered average, the rest of Russia lives much more modestly. With their high level of income, the Chinese prefer richer cars, the “budget” among them is not very popular. Although such cars are also produced there. But, unfortunately, they cannot reach the Russian consumer.
– There is a local brand in China – Jetta. Among other things, he makes a model from the VW Polo class. They sell it from the factory, in terms of “our”, for about 600,000 rubles. Take and export to Russia. But for this, the importer will have to spend about 800,000 rubles on each car – in the form of import duties and surcharges at our customs. And the price of delivery from China to the European part of Russia will “eat up” at least 200,000 rubles. As a result, a cheap Chinese car in Russian retail will cost at least 1.6-1.7 million rubles, says Alexei Podshchekoldin, head of the Russian Automobile Dealers Association (ROAD).
He believes that our customs laws are now being “tightened up” to protect a particular national automaker. Which is now represented in the passenger market by almost only AVTOVAZ.
– It is unofficially known that AVTOVAZ will start selling its LADA Vesta NG at a price of 1.6-1.7 million rubles (other market experts speak of prices in the region of 1.2 million rubles. – approx editions). But for the same money you can bring its Chinese competitor to Russia, having previously paid a lot of money at customs and for delivery! This means that we cannot really create a competitive car ourselves! In fact, we have no one to protect with duties, Mr. Podshchekoldin believes.
In his opinion, the Russian authorities should now urgently start creating real conditions that would encourage the Chinese to organize car production in Russia.
– I was recently in China – to build partnerships with local auto businessmen. So: at 10 o’clock an official of the municipal administration was already at my door in the attitude of “whatever you want”! Immediately organized meetings with industry representatives. For eleven hours a day non-stop, this Chinese was with me with one goal: to create conditions for mutually beneficial cooperation between local industrialists and the Russian guest. In China, the state works closely with the entrepreneur. But in Russia, more and more attention is being paid to how to regain control of the businessman and to squeeze taxes. And not to create conditions for its development, – complains Gennady Podshchekoldin.
At the same time, our expert believes that Russia will live well without Europe: the Chinese economy will gladly swallow all the resources we offer it and give everything we need in return.
“However, it is critical that we do not end up in the position of natives selling glass beads for gold. To do this, it is not enough to maintain high customs duties and wait until the Chinese themselves suddenly condescend to build their factories in Russia. Yes, they are also interested in the potential capacity of the Russian car market of 1-1.5 million cars per year. But only as “optional”. Because their home market alone is 27 million cars a year. And then there are the markets of the Arab countries, Europe, Asia … In Russia, the world has certainly not come together like a wedge. And if we want to drive not in right-hand drive “used” and “gold” LADA cars, but in normal and inexpensive cars, we urgently need to create really attractive conditions for localization for the Chinese automotive industry. But at the moment I do not find much enthusiasm in this direction among the Russian officials I meet, ”the head of the ROAD emphasized in an exclusive interview with the AvtoVzglyad portal.
globallookpress.com’s photo
globallookpress.com’s photo
globallookpress.com’s photo
For example, many experts in the Russian car market do not take into account that the “trick” of Shanghai car dealerships is “specialization” in electric vehicles, drones and other innovations in the automotive industry. And the Russians are clearly not ready for these groundbreaking things now: we would have more modern, but cheap cars with traditional internal combustion engines. The Russian car business clearly had nothing to “catch” at this motor show. And in general, the domestic request for a car “cheap and cheerful” sounds somewhat out of pocket for Chinese industrialists.
The fact is that now in China the average salary in the country (!) Is at the level of 110,000 rubles per month (if converted from yuan). And only here in Moscow such a patch is considered average, the rest of Russia lives much more modestly. With their high level of income, the Chinese prefer richer cars, the “budget” among them is not very popular. Although such cars are also produced there. But, unfortunately, they cannot reach the Russian consumer.
– There is a local brand in China – Jetta. Among other things, he makes a model from the VW Polo class. They sell it from the factory, in terms of “our”, for about 600,000 rubles. Take and export to Russia. But for this, the importer will have to spend about 800,000 rubles on each car – in the form of import duties and surcharges at our customs. And the price of delivery from China to the European part of Russia will “eat up” at least 200,000 rubles. As a result, a cheap Chinese car in Russian retail will cost at least 1.6-1.7 million rubles, says Alexei Podshchekoldin, head of the Russian Automobile Dealers Association (ROAD).
He believes that our customs laws are now being “tightened up” to protect a particular national automaker. Which is now represented in the passenger market by almost only AVTOVAZ.
– It is unofficially known that AVTOVAZ will start selling its LADA Vesta NG at a price of 1.6-1.7 million rubles (other market experts speak of prices in the region of 1.2 million rubles. – approx editions). But for the same money you can bring its Chinese competitor to Russia, having previously paid a lot of money at customs and for delivery! This means that we cannot really create a competitive car ourselves! In fact, we have no one to protect with duties, Mr. Podshchekoldin believes.
In his opinion, the Russian authorities should now urgently start creating real conditions that would encourage the Chinese to organize car production in Russia.
– I was recently in China – to build partnerships with local auto businessmen. So: at 10 o’clock an official of the municipal administration was already at my door in the attitude of “whatever you want”! Immediately organized meetings with industry representatives. For eleven hours a day non-stop, this Chinese was with me with one goal: to create conditions for mutually beneficial cooperation between local industrialists and the Russian guest. In China, the state works closely with the entrepreneur. But in Russia, more and more attention is being paid to how to regain control of the businessman and to squeeze taxes. And not to create conditions for its development, – complains Gennady Podshchekoldin.
At the same time, our expert believes that Russia will live well without Europe: the Chinese economy will gladly swallow all the resources we offer it and give everything we need in return.
“However, it is critical that we do not end up in the position of natives selling glass beads for gold. To do this, it is not enough to maintain high customs duties and wait until the Chinese themselves suddenly condescend to build their factories in Russia. Yes, they are also interested in the potential capacity of the Russian car market of 1-1.5 million cars per year. But only as “optional”. Because their home market alone is 27 million cars a year. And then there are the markets of the Arab countries, Europe, Asia … In Russia, the world has certainly not come together like a wedge. And if we want to drive not in right-hand drive “used” and “gold” LADA cars, but in normal and inexpensive cars, we urgently need to create really attractive conditions for localization for the Chinese automotive industry. But at the moment I do not find much enthusiasm in this direction among the Russian officials I meet, ”the head of the ROAD emphasized in an exclusive interview with the AvtoVzglyad portal.
Donald Salinas is an experienced automobile journalist and writer for Div Bracket. He brings his readers the latest news and developments from the world of automobiles, offering a unique and knowledgeable perspective on the latest trends and innovations in the automotive industry.