Economy, Auto
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Russian Car Sales Down 10% in 2016

Russian Car Sales Down 10% in 2016Russian Car Sales Down 10% in 2016

Russia's once-booming automotive market is seen falling 10% in 2016, as car sales tumble for the fourth consecutive year, said the head of the country's largest dealership group.

Rolf dealership head Tatyana Lukovetskaya said sales could fall to 1.3 million this year, less than half of the nearly 3 million vehicles sold in Russia in 2012, as the country's deepening economic downturn further erodes consumer spending, Reuters reported.

"If you used to change your car every three years, now you will change it every five years," Lukovetskaya said.

After a decade of annual sales growth in excess of 10%, Russia's car industry has become one of the most high-profile victims of the country's economic crisis. This has been fueled by lower prices of oil, its main export, and western sanctions over Moscow's actions in Ukraine.

Car sales plunged 36% to 1.6 million vehicles in 2015, according to the Association of European Businesses lobby group, a far cry from the 2012-13 peak when during some months Russia ranked as Europe's largest car market by sales.

Sales fell 17% in the first quarter of 2016, though the AEB is less pessimistic than Lukovetskaya, saying it sees sales falling just 4.7% this year.

Lukovetskaya said the less severe decline did not mean the market was bottoming out, as forecast by some analysts.

"What is the bottom? When will it end?" she said. "When we understand that the economy has begun to improve, then we will see we are at the bottom. But right now the economy is not recovering."

Financialtribune.com