The collapse and reconstruction of the Russian automobile industry

Russia's car market is in 2022 The year witnessed a collapse, which may become an opportunity for rebirth.

 

Following the Russia-Ukraine conflict in February, foreign automakers accelerated their withdrawal from this troubled region, and the Russian car market entered an unprecedented " vacuum ” state.

 

 

2022 In the first half of the year, Russian car sales were 37.0 ten thousand units, a year-on-year decrease of 56.9% 。10 While the global car market saw a rise in all months, Russia continued to decline. According to the European Business Association ( AEB ), in 10 month alone, only 4.52 ten thousand cars and light commercial vehicles were sold, a year-on-year decrease of 62.8% and a month-on-month decrease of 3.1% 。

 

The head of Russian automaker Avtovaz believes that Russian new car sales this year are expected to be only 67 ten thousand to 70 ten thousand units, possibly less than a quarter of a decade ago.  

 

The collapse of the Russian car market is due to two main reasons: Firstly, many global auto brands have stopped production and exports, resulting in a lack of cars. Secondly, the localization level of Russian automobiles is very low, with passenger cars relying on imports for approximately 70%-80% of their parts. The blockade and stagnation of parts have prevented some automakers from effectively producing.

 

 

In addition, when national instability occurs and various sectors face risks, public purchasing confidence and ability are suppressed. Therefore, the collapse of the national automotive industry and public confidence needs to be gradually rebuilt, and external forces may be needed to accelerate this process.

 

 

A close moment for Sino-Russian automobiles

 

This year has been one of rapid expansion for Chinese automobiles, marking the first year of exports. From South America to the Middle East and " priority markets ” Europe, Chinese automobiles have achieved good results. Behind these widely publicized achievements, there is another country's automobile market that is being gradually occupied by China.

 

 

Russian automotive market analysis agency Autostat indicates that Chinese automobiles account for approximately 33.4% of total sales in the Russian market, setting a new historical high. Of course, this is only short-term data from seven days, 2022 year 11 month 21 day to 27 day, a total of 3561 Chinese cars were sold in Russia, approximately equivalent to one-third of the total sales in the Russian car market.

 

However, even for the entire month of October, the market share of Chinese automobiles in Russia has increased significantly. In 2022 year 10 month, sales of Chinese cars in Russia exceeded 1.2 ten thousand units, accounting for approximately 29.5% of total sales. However, it is worth noting that at the beginning of the year, the share of Chinese cars in the Russian market did not exceed 2022年初中国汽车在俄罗斯市场的占比尚未超过10%。

 

The most popular Chinese car brands in the Russian market include Chery, Haval, and Geely. The results of the first 10 months show that 4 Chinese companies entered the top 10 in sales in the Russian market, namely Haval, Chery, Geely, and Xingtu.

 

 

The top spot on the October sales chart remains the leader of the Russian car market, Lada (Lada), a car brand owned by Russian manufacturer AvtoVAZ . Since 1973 year during the Soviet era, it was initially only sold domestically. Later, 20 year, the brand's automotive business expanded throughout the Soviet Union, Eastern European countries, and China, and once became a symbol of urban life at the time. 2016 year, Renault acquired the brand. Then this year, Renault sold the brand to the Russian government.

 

Following this, Haval rose to second place with sales of 4400 units, a year-on-year decrease of 7.8% . Compared to September, the sales of Chinese brands in Russia increased by 29% while Lada decreased by 7.2% 。

 

 

Udalova pointed out that the share of Chinese manufacturers will continue to grow, including through expanding model series. According to him, currently, Chinese brands in the Russian market mainly focus on SUVs class vehicles, while C class and B class vehicles, these two segments have almost no Chinese models.

 

Russian automotive market analysis agency Autostat indicates that in the first 2022 months of 10 year, only Chinese brand passenger cars saw sales growth in the Russian market, with steady growth including Haval, a brand of Great Wall Motors, which grew by 8.14% to 4316 units, and Xingtu, which started low but grew rapidly, increasing by 472% to 1163 units. " Rumor ” Jiang Huai sold 273 vehicles, growth 92% Chang'an started to exert efforts, growth 20.2% bought 220 vehicles.

 

 

Autostat President Sergey ∙ Tsarelikov said , Chinese brands have partially offset the impact of Western companies withdrawing. The market is recovering, albeit very slowly.

 

" Globally branded cars from China also appear in the Russian market, such as the Volkswagen Bora and Mazda CX-4 . As a result, the actual market share of Chinese cars in Russia is even larger. I believe that these models will become increasingly prevalent in the Russian market, ” Tsarelikov said.

 

The cooperation between China and Russia in the automotive field is closer than simple import and export.