According to the founder of Rolf, one of Russia’s major dealerships, the fast declining situation on the car market might force many of the country’s dealerships to merge or “die”.
Russian consumers have been postponing since last year major purchases – such as cars – because of an economic downturn caused by the weakening local currency and the recent political troubles brought by the interference in Ukraine.
“The dealership business is fragmented, and apparently it’s on the threshold of consolidation. Everyone is talking to everyone,” Sergei Petrov said at the Reuters Russia Investment Summit. “There probably will be IPOs (initial public offerings),” Petrov added. “Clearly now is not the best time for flotation, but nobody is in a hurry, everyone is trying to grow in size first. Once there is a window – they will go for it.”
The executive further predicted the Russian car market would not be blessed with a swift recovery – as it was the case with the sales following the 2008-2009 economic crisis. In 2014, auto sales in the country have been forecast to be the lowest since the onset of the global downturn. According to the Moscow-based Association of European Businesses, deliveries fell in August a huge 26% and so far this year they are down 12.1% from 2013 (which declined around 5% from 2012 as well).