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The results of the first half of 2023 inspire very cautious optimism. The “Chinese” still managed, albeit partially, but in one person to replace the European, Japanese and
Looking at the results of the past six months, one can breathe a sigh of relief: the car market, of course, collapsed, but did not collapse into dust. He managed to stabilize and he is slowly starting to get out of that ugly place where he came. Moreover, this hit, I repeat, was not the fault of the evil foreign brands who meekly submitted to the sanctions regime imposed on them, but because of the destructive activities of industry leaders of various ranks, incompetent about … well, let it be the whole period of prosperity “whistling”. And all because they cared about everything, but not about strengthening the auto industry.
Now the market follows the principle of the resilient Sam Weller: “Let’s go slow. We will gradually achieve the best. The pace of recovery is really fast. But forward movement is inevitable and continuous. Each new month brings an increase in sales, with the exception of a small failure in May – the abundance of holidays played a negative role. According to the results of the first half of the year, Russian drivers bought 401,600 cars, which is 14% more than in 2022.
However, this is only half of the sales volume for 6 months of 2021. However, let’s take a little optimism from the aforementioned Sam Weller: if the growth rate of the market is maintained, Russia has every chance to reach the level of 1 million cars sold per year instead of last year’s 626,000 – and this is already ⅔ of the minimum number of new cars needed for a normal life.
What is frustrating in this situation? Yes, the fact that all growth was mainly driven by companies from China. A year ago their share was 21%, and now they have captured 49% of the market – not counting the cars that hide their Chinese guts under Russian decals. Month after month, newcomers from the Celestial Empire are expanding their sphere of influence, and this is done mainly thanks to domestic and Korean brands, from which they took only 1% before June.
With the Koreans, everything is clear – they are supported mainly by imports, since local production is worth it. But the situation with domestic producers is also not Newton’s binomial situation. In short, one AvtoVAZ takes the rap for everyone, but with its five models it cannot compete with 29 Chinese brands and sub-brands that are officially (!) present in Russia and sell more than 100 models here.
In general, the market has stabilized. The budget and mid-price segments are saturated with “Chinese” and conditional “Russians”. Parallel, gray and all sorts of other imports give us premium cars in an almost unchanged volume of 4% of all sales. This seems quite meager enough, but the most terrible shortage is felt only in the price category up to 2 million rubles. And here we can make a gloomy forecast – until we grow to an annual volume of 1.5 million cars and the market is not saturated and prices do not fall, cheaper models will not be imported.
However, away from dreams – “hope entered, enchanted.” The watchful eye of the Ministry of Industry and Trade is closely following the course of events and the foot is already raised above the rake. Having failed once in the localization policy, officials want to repeat it. That is, they rely, as usual, not on a gingerbread, but on a whip. What kind of economic preferences, cheap loans, cheap electricity, cheap rent, minimal bureaucracy? Is this how the Americans are cheating European manufacturing companies? Well, they don’t tell us. Here’s raising the recycling fee for all imports, which will only save the market for now – this is our way.
What this will lead to is no secret. Instead of growing at 50%, we may well be hitting the market’s final decline, which will eat up the small positive shifts in the first half of the year. Let’s give the floor to the Vice President and Executive Director of the ROAD Association Vyacheslav Zhigalov:
– A simple solution is to protect the domestic industry and give it the opportunity to develop in one way or another. But this in no way encourages the manufacturer to solve problems that make us low competitiveness. This creates the illusion that we are under the protection of the state and nothing needs to be done about it. The easiest way is to increase the excise tax, increase the recycling fee, limit, ban, delay, and so on. But the problems – as they were 15 years ago in the domestic auto industry – remain. They are not resolved. So this initiative is a disservice, it is absolutely detrimental to the development of our domestic industry,” he said in an interview with the AvtoVzglyad portal.
Die, Denis, you couldn’t say it better!
Looking at the results of the past six months, one can breathe a sigh of relief: the car market, of course, collapsed, but did not collapse into dust. He managed to stabilize and he is slowly starting to get out of that ugly place where he came. Moreover, this hit, I repeat, was not the fault of the evil foreign brands who meekly submitted to the sanctions regime imposed on them, but because of the destructive activities of industry leaders of various ranks, incompetent about … well, let it be the whole period of prosperity “whistling”. And all because they cared about everything, but not about strengthening the auto industry.
Now the market follows the principle of the resilient Sam Weller: “Let’s go slow. We will gradually achieve the best.” The pace of recovery is really fast. But forward movement is inevitable and continuous. Each new month brings an increase in sales, with the exception of a small failure in May – the abundance of holidays played a negative role. According to the results of the first half of the year, Russian drivers bought 401,600 cars, which is 14% more than in 2022.
However, this is only half of the sales volume for 6 months of 2021. However, let’s take a little optimism from the aforementioned Sam Weller: if the growth rate of the market is maintained, Russia has every chance to reach the level of 1 million cars sold per year instead of last year’s 626,000 – and this is already ⅔ of the minimum number of new cars needed for a normal life.
What is frustrating in this situation? Yes, the fact that all growth was mainly driven by companies from China. A year ago their share was 21%, and now they have captured 49% of the market – not counting the cars that hide their Chinese guts under Russian decals. Month after month, newcomers from the Celestial Empire are expanding their sphere of influence, and this is done mainly thanks to domestic and Korean brands, from which they took only 1% before June.
With the Koreans, everything is clear – they are supported mainly by imports, since local production is worth it. But the situation with domestic producers is also not Newton’s binomial situation. In short, one AvtoVAZ takes the rap for everyone, but with its five models it cannot compete with 29 Chinese brands and sub-brands that are officially (!) present in Russia and sell more than 100 models here.
In general, the market has stabilized. The budget and mid-price segments are saturated with “Chinese” and conditional “Russians”. Parallel, gray and all sorts of other imports give us premium cars in an almost unchanged volume of 4% of all sales. This seems quite meager enough, but the most terrible shortage is felt only in the price category up to 2 million rubles. And here we can make a gloomy forecast – until we grow to an annual volume of 1.5 million cars and the market is not saturated and prices do not fall, cheaper models will not be imported.
However, away from dreams – “hope entered, enchanted.” The watchful eye of the Ministry of Industry and Trade is closely following the course of events and the foot is already raised above the rake. Having failed once in the localization policy, officials want to repeat it. That is, they rely, as usual, not on a gingerbread, but on a whip. What kind of economic preferences, cheap loans, cheap electricity, cheap rent, minimal bureaucracy? Is this how the Americans are cheating European manufacturing companies? Well, they don’t tell us. Here’s raising the recycling fee for all imports, which will only save the market for now – this is our way.
What this will lead to is no secret. Instead of growing at 50%, we may well be hitting the market’s final decline, which will eat up the small positive shifts in the first half of the year. Let’s give the floor to the Vice President and Executive Director of the ROAD Association Vyacheslav Zhigalov:
– A simple solution is to protect the domestic industry and give it the opportunity to develop in one way or another. But this in no way encourages the manufacturer to solve problems that make us low competitiveness. This creates the illusion that we are under the protection of the state and nothing needs to be done about it. The easiest way is to increase the excise tax, increase the recycling fee, limit, ban, delay, and so on. But the problems – as they were 15 years ago in the domestic auto industry – remain. They are not resolved. So this initiative is a disservice, it is absolutely detrimental to the development of our domestic industry,” he said in an interview with the AvtoVzglyad portal.
Die, Denis, you couldn’t say it better!
Source: Avto Vzglyad
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.
