Russia: auto collapse slows to 19 percent in August image

The Russian new vehicle deliveries were down for the eighth straight month in August, signaling the country’s deep recession is far from over even as the weaker currency enticed certain parts of the consumer mass to make new purchases.

According to a statement by the Moscow-based Association of European Businesses, sales fell by 19 percent to 138, 670 units – a smaller decline than the 28 percent drop in July. Now eight month sales in Russia have plunged 34 percent from the same period last year to 1.05 million autos. The slide is another indicator of the Russian economy’s issues – which could be even deeper on the long run as salaries also decline. Recently the Russian government believed the peak of the recession was now over but was immediately forced to rekindle its forecast for the current year and the next because last month the global oil prices fell once more and the home currency took another dive. During the past 12 months the local ruble has been the world’s worst performing currency after dropping 46 percent against the dollar.

“The latest sharp drop in the value of the ruble is a sure guarantee for the market to see an immediate uplift in sales, only to be followed by a corresponding slump later,” commented Joerg Schreiber, chairman of the AEB automobile manufacturers committee.

Last year Russian auto sales crumbled after years of 10 percent of more growth because of the economical weakness, the ruble collapse and the political uncertainty stemming from the confrontation with western powers over Moscow’s involvement into the Ukraine crisis.

Via Automotive News Europe