A fortnight analytical Agency and the automakers let the end of 2015, analyzed the data, predicted what will happen to the market in the future. Fortunately, in addition to the formalities, figures and discussions January gave a start to trying to get out of the crisis.
The government moved to action
According to experts, the Russian car market in 2016 are expected to become even more serious turmoil than in 2015. After falling 36 percent and gloomy forecasts, it became clear that their own industry is unlikely to return to previous levels. And as stated at the end of January, Prime Minister Dmitry Medvedev, the Russian car industry without government support in 2016 will not be able to reach the results that the government hoped to get. Thus, to achieve these objectives, the government has to assist the industry and to take steps to solve problems.
In 2016 government support the automotive industry will amount to 50 billion roubles. This government decree was signed by Prime Minister of what became known on January 22 at a meeting at AVTOVAZ. Funds for the program of preferential car loan (one of the main methods of stimulation of demand) would decrease compared to 2015 year to 2.3 billion rubles. But almost 10 billion roubles will be allocated for the implementation of similar programs operating in 2013 and 2015. Moreover, it is possible that the program of preferential car loans in 2016 it will be possible to buy cars that cost 1 million, as it was in 2015, and 1,15 million rubles. With a significant increase in the price of a car, this change no doubt will have a positive impact on demand and, as a consequence, the sales figures.
Also this month, Russian President Vladimir Putin has instructed the government to develop and approve strategy of development of the automotive industry and automotive component production for the period up to 2025. The program should be aimed at achieving import substitution of products and technologies. It is anticipated that the document will be ready by 1 March 2016. The strategy will include a market forecast and a plan of action through which it will be possible to ensure “the effective functioning of the automotive industry’s current economic trends”.
Betting on exports
On the background of the devaluation of the ruble one of the main areas in 2016 for the automotive industry will be arranging exports. According to the head of Minpromtorg Denis Manturov, for these purposes will be allocated an additional 5 billion roubles. As planning Minister, by 2025, the share of exports of the automotive industry needs to increase from 7.7% to 25%. Among the main contenders for subsidy on the export of “AVTOVAZ” with the new Lada Vesta and Lada Xray. In the fall of 2015, the company representatives said that export is one of the most important directions of their activity, and new models of Lada scheduled to be sold on the markets of CIS countries and in Europe and the middle East in 2016. Also among the contenders for subsidy on the export of domestic manufacturers such as UAZ, GAZ and KAMAZ. As for 2015, the export of cars decreased by 25%, imports by 50%, reports IA “SeverInform”.
Not gonna get us: price growth continues
Beginning in 2015, the trend in the change in the cost of cars continued in January 2016. Among officially submitted on the Russian market of automobile manufacturers in January the price has changed from thirty of them, mostly upward, according to the analytical Agency “AUTOSTAT”. So, for the first ten days of January, changes to the price lists occurred in seventeen companies (Chevrolet, Citroen, Datsun, Ford, Geely, Hyundai, Jaguar, KIA, Land Rover, Lifan, Mitsubishi, Nissan, Peugeot, Renault, Skoda, Volkswagen, AVTOVAZ). It is important to note that changes in advance of the prices officially reported only four companies: UAZ, GM-AVTOVAZ, Renault and Volvo Sagas Russia.
Due to the devaluation of the national currency, the importers are forced to revise the price of cars to balance the cost of the car in rubles and foreign currencies. This opinion was expressed by Director General of the analytical Agency “Auto-Dealer-SPb” Mikhail Chaplygin. “Importers are very reluctant and forced to take this step. But it is the law of the market — no one wants to lose yield,” — said the expert. According to him, the increase will continue if they keep on the depreciation of the ruble.
Lada for the price of a foreign car
Meanwhile Russian manufacturers, despite the market turmoil, continue to prepare to release a new model. So, in January, was declassified the cost of the second revolutionary novelties of AVTOVAZ — Lada Xray. The starting price of the machine is 589 thousand rubles, reported the press service of the company. Thus, domestic Lada was more expensive than its direct competitor of foreign manufacture Renault Sandero (from 419 thousand rubles). Thank you to buy domestic “Frets” on the price of imported cars will be known only after the official start of sales of Xray scheduled for February 14, 2016.
As previously reported IA REGNUM, the production of Lada Vesta and Lada Xray “AVTOVAZ” plans to occupy about 20% of the total market of Russia and increase sales in major cities such as Moscow and St. Petersburg.
