What cars and how to buy in an era of scarcity and rising prices?
- June 1, 2022
- 0
In April, Russian car dealers sold a total of 33,000 new cars and light commercial vehicles. As the AvtoVzglyad portal calculated, the decline was a record 78.5%. And
In April, Russian car dealers sold a total of 33,000 new cars and light commercial vehicles. As the AvtoVzglyad portal calculated, the decline was a record 78.5%. And the reasons for the collapse of the car market are completely understandable: some car dealers simply have nothing to sell, while others sell the leftovers at high prices, which our compatriots were not ready for. It’s not all bad though…
With trucks of all sizes, the situation is also dire. Total sales of heavy commercial vehicles fell by 44%, and the market for new light commercial vehicles, ie light commercial vehicles, actually collapsed: fewer than 5,000 cars were registered, according to the Avtostat agency! That is 65% less than a year earlier. And there are not so many chances that May will prove more successful… On the contrary, analysts predict an even deeper fall.
Corporate sales could easily pull the domestic auto market out of this abyss. After all, people always need transport! Especially now that import substitution has finally become quite a tangible process. Industrialists actively control the production of new products, which should replace foreign goods. And, of course, delivery requires trucks and vans. But buying a new car – especially a commercial one – is now almost impossible. At least because the European Union has introduced another package of sanctions, which prohibits the export of trucks to Russia. Therefore, domestic carriers rushed to look for an affordable alternative to the equipment of the “great European seven”, including Volvo, MAN, Scania, Mercedes, DAF, Iveco and Renault.
This alternative turned out to be “Chinese”, Belarusian MAZs, as well as our “Urals” and KamAZ trucks. However, which have increased in price quite a bit: last year a two-axle KamAZ-54901 tractor cost about 7,000,000, and now similar vehicles are offered by dealers at prices ranging from 13 to 16 million rubles. Used commercial vehicles of foreign brands have not risen less sharply in recent times.
On the contrary, the Central Bank, which is supposed to help the economy, has put things on track by raising the key rate to a record 20% (now the bar is gradually lowering, but remains prohibitively high). As a result, borrowed money has become “expensive”. Therefore, it makes no sense to buy cars on credit or on lease – such an acquisition will pay off for a very, very long time. If it ever pays…
To save the situation, the same leasing companies have to go it alone, without the support of officials. For example, “Gazprombank Autoleasing” voluntarily lowered interest rates on leasing all types of equipment. The company expects a further cut in the policy rate and therefore the current revision of the rate policy can be seen as a kind of “preventive game”.
And here’s another example of private traders being wiser and more efficient than the authorities – at supporting the secondary market. According to “AUTOSTAT”, the ratio of new to used cars has now reached record levels: For every car sold by a dealer without a run, there are four transactions in the “secondary” at once! But it is extremely difficult for legal entities to buy a used one. Let’s explain. As a rule, due to the peculiarities of taxation, credit organizations finance transactions involving equipment that previously belonged to legal entities. And this is a meager – literally 2-3% – share of the entire market. But yes: some leasing companies have invented the problem. They are willing to buy cars that were previously privately owned, but on the condition that they are sold by a dealer.
By the way, about dealers. We have already said that Chinese brands are now taking maximum action to win the hearts of Russians. A very curious example is the promotions of the Chery and Exeed brands, which are prepared to give a discount to legal entities and entrepreneurs of up to 21% if the lease transaction is carried out via Gazprombank Autoleasing. In this case, additional savings are made through a discount on fuel.
In general, everything is as usual: While officials of all ranks confidently talk about business support and import substitution programs, which promise rapid economic growth, it is not the authorities who are doing the most for this growth, but the company itself. Sometimes you have to come up with very non-trivial schemes for this, such as “leaseback” – this mechanism can equally replace traditional loans. How it works? Transport is bought off by a leasing company, which simultaneously concludes a lease. The transfer of ownership is done only on paper: in fact, the tenant continues to operate the property and returns it to itself at the end of the contract. Elegant, isn’t it?
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photo globallookpress.com
photo globallookpress.com
With trucks of all sizes, the situation is also dire. Total sales of heavy commercial vehicles fell by 44%, and the market for new light commercial vehicles, ie light commercial vehicles, actually collapsed: fewer than 5,000 cars were registered, according to the Avtostat agency! That is 65% less than a year earlier. And there are not so many chances that May will prove more successful… On the contrary, analysts predict an even deeper fall.
Corporate sales could easily pull the domestic auto market out of this abyss. After all, people always need transport! Especially now that import substitution has finally become quite a tangible process. Industrialists actively control the production of new products, which should replace foreign goods. And, of course, delivery requires trucks and vans. But buying a new car – especially a commercial one – is now almost impossible. At least because the European Union has introduced another package of sanctions, which prohibits the export of trucks to Russia. Therefore, domestic carriers rushed to look for an affordable alternative to the equipment of the “great European seven”, including Volvo, MAN, Scania, Mercedes, DAF, Iveco and Renault.
This alternative turned out to be “Chinese”, Belarusian MAZs, as well as our “Urals” and KamAZ trucks. However, which have increased in price quite a bit: last year a two-axle KamAZ-54901 tractor cost about 7,000,000, and now similar vehicles are offered by dealers at prices ranging from 13 to 16 million rubles. Used commercial vehicles of foreign brands have not risen less sharply in recent times.
On the contrary, the Central Bank, which is supposed to help the economy, has put things on track by raising the key rate to a record 20% (now the bar is gradually lowering, but remains prohibitively high). As a result, borrowed money has become “expensive”. Therefore, it makes no sense to buy cars on credit or on lease – such an acquisition will pay off for a very, very long time. If it ever pays…
To save the situation, the same leasing companies have to go it alone, without the support of officials. For example, “Gazprombank Autoleasing” voluntarily lowered interest rates on leasing all types of equipment. The company expects a further cut in the policy rate and therefore the current revision of the rate policy can be seen as a kind of “preventive game”.
And here’s another example of private traders being wiser and more efficient than the authorities – at supporting the secondary market. According to “AUTOSTAT”, the ratio of new to used cars has now reached record levels: For every car sold by a dealer without a run, there are four transactions in the “secondary” at once! But it is extremely difficult for legal entities to buy a used one. Let’s explain. As a rule, due to the peculiarities of taxation, credit organizations finance transactions involving equipment that previously belonged to legal entities. And this is a meager – literally 2-3% – share of the entire market. But yes: some leasing companies have invented the problem. They are willing to buy cars that were previously privately owned, but on the condition that they are sold by a dealer.
By the way, about dealers. We have already said that Chinese brands are now taking maximum action to win the hearts of Russians. A very curious example is the promotions of the Chery and Exeed brands, which are prepared to give a discount to legal entities and entrepreneurs of up to 21% if the lease transaction is carried out via Gazprombank Autoleasing. In this case, additional savings are made through a discount on fuel.
In general, everything is as usual: While officials of all ranks confidently talk about business support and import substitution programs, which promise rapid economic growth, it is not the authorities who are doing the most for this growth, but the company itself. Sometimes you have to come up with very non-trivial schemes for this, such as “leaseback” – this mechanism can equally replace traditional loans. How it works? Transport is bought off by a leasing company, which simultaneously concludes a lease. The transfer of ownership is done only on paper: in fact, the tenant continues to operate the property and returns it to itself at the end of the contract. Elegant, isn’t it?
SUBSCRIBE FOR EXCLUSIVE CONTENT
PORTAL “AVTOVGLYAD” IN TELEGRAM
Source: Avto Vzglyad
I’m Sandra Torres, a passionate journalist and content creator. My specialty lies in covering the latest gadgets, trends and tech news for Div Bracket. With over 5 years of experience as a professional writer, I have built up an impressive portfolio of published works that showcase my expertise in this field.
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