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The new president of the Russian Automobile Dealers Association (ROAD), Alexei Podshchekoldin, unlike the head of the Ministry of Industry and Trade of the Russian Federation, Denis Manturov,
Mr Podshchekoldin reminded the public of Russian President Vladimir Putin’s demand to make cars more accessible to citizens. But as the AvtoVzglyad portal has repeatedly written, the domestic bureaucracy, headed by the Ministry of Industry and Trade, has not actually taken any action in this direction. Unless, of course, we don’t count the rather miserable scheme of resuscitating the state’s program of preferential auto loans. ROAD has more serious proposals.
First, dealers feel it necessary to curb the greed of banks making money from takeover deals, making the already bleak lives of car dealers downright bleak. Financiers take as much as 2% of the transaction amount. At the same time, it should be understood that the profitability of car dealerships, even in the best years, was 3.8% -4%, and now it does not exceed 2.8%.
Secondly, the ROAD is convinced that banks should lower car loan rates and generally switch to them from consumer loans, which many Russians use to buy cars. This allows the customer, among other things, to easily return a loan car to the same dealer in a difficult financial situation and not to blow up financial bubbles.
Thirdly, according to members of the association, it is necessary to actively develop leasing in Russia. For example, in the US, this instrument accounts for up to 30% of automatic trades. And most of them are privately owned. In our country, only 7-8% of car buyers use leasing, and mostly only “yuriki”. This bias should be corrected according to the ROAD.
Finally, given the shortage of new cars in the market, you should pay special attention to used cars. In particular, freeing car dealers from double VAT, which severely restricts dealers’ maneuvers.
As an example, Mr. Podshchekoldin mentioned the situation with cheap cars in Vladivostok. A retailer can easily buy a whole lot of cheap cars there and then send them to Moscow, but the double VAT makes this story completely uninteresting. And working with private traders means exposing yourself and your customers to serious risks. Admittedly, according to the new chairman of the ROAD, there is already some progress in that direction and double VAT can be abolished by the end of 2023.
Let’s see how these proposals, if implemented, will ultimately affect the long-suffering domestic auto market.
Mr Podshchekoldin reminded the public of Russian President Vladimir Putin’s demand to make cars more accessible to citizens. But as the AvtoVzglyad portal has repeatedly written, the domestic bureaucracy, headed by the Ministry of Industry and Trade, has not actually taken any action in this direction. Unless, of course, we don’t count the rather miserable scheme of resuscitating the state’s program of preferential auto loans. ROAD has more serious proposals.
First, dealers feel it necessary to curb the greed of banks making money from takeover deals, making the already bleak lives of car dealers downright bleak. Financiers take as much as 2% of the transaction amount. At the same time, it should be understood that the profitability of car dealerships, even in the best years, was 3.8% -4%, and now it does not exceed 2.8%.
Secondly, the ROAD is convinced that banks should lower car loan rates and generally switch to them from consumer loans, which many Russians use to buy cars. This allows the customer, among other things, to easily return a loan car to the same dealer in a difficult financial situation and not to blow up financial bubbles.
Thirdly, according to members of the Association, it is necessary to actively develop leasing in Russia. For example, in the US, this instrument accounts for up to 30% of automatic trades. And most of them are privately owned. In our country, only 7-8% of car buyers use leasing, and mostly only “yuriki”. This bias must be corrected according to the ROAD.
Finally, given the shortage of new cars in the market, you should pay special attention to used cars. In particular, freeing car dealers from double VAT, which severely restricts dealers’ maneuvers.
As an example, Mr. Podshchekoldin mentioned the situation with cheap cars in Vladivostok. A retailer can easily buy a whole lot of cheap cars there and then send them to Moscow, but the double VAT makes this story completely uninteresting. And working with private traders means exposing yourself and your customers to serious risks. Admittedly, according to the new chairman of the ROAD, there is already some progress in that direction and double VAT can be abolished by the end of 2023.
Let’s see how these proposals, if implemented, will ultimately affect the long-suffering domestic auto market.
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.
