The Russian automotive sales followed the initial forecast, which had shown that the automotive market will not even reach 1.5 million units in 2009. The decrease was registered by all segments and felt by all the volume automakers in the country, excepting Kia.
While the top five brands in Russia, namely Lada, Chevrolet, Ford, Hyundai and Renault registered negative year-to year statistics, Kia managed to increase its sales in almost all segments, as most of its new models posted a sales increase in the second half of the year.
“The situation in Russia is very serious, perhaps the worst in any major market. The market dropped by over 1.3 million vehicles last year, in contrast to the growth of recent times. The most interesting part is these losses could have been even greater, but for action by the Russian government.” Evangelos Hadjistavrou, Regional General Manager, JATO Dynamics, said.
The market contracted heavily although the Russian government developed a subsidies program, supporting loan to customers of any new domestic-built cars priced lower than 13,500 euro. For 2010 the authorities have prepared a scrappage scheme, offering 1,125 euro for each new car.
Last year, the Russian authorities decided to increase customs duties for imported cars by 5 percent. This put even more pressure on the automotive companies which also had to face a 35 percent increase in the euro/ruble exchange rate. As a consequence, vehicle prices went up, affecting sales even more.