Russia: GM cuts production image

The No. 1 US automaker, heavily involved in Russia’s local manufacturing industry, announced it decided to lower car production output at its factory close to St. Petersburg, Russia, because of the country’s continued slump in demand.

Europe’s second largest auto market, once poised to overcome the traditional No. 1 – Germany – is now bracing for a big slide this year, with auto industry experts predicting sales could dip as low as 12-13% from the figures recorded in 2013. The slide could look manageable, but we need to remember that 2013’s deliveries were also 5% lower than in 2012.

According to a GM spokesperson, the manufacturing facility, producing the Chevrolet Cruse, Trailblazer and Opel Astra models is programmed to have just four working days in August and September and then eight in October.

The Russian Association of European Businesses (AEB) lobby group said that after the sales dropped 17% in June, the following month’s tally was even worse, with a 23% slump in demand. Data shows Chevrolet sales tumbled 45% last month, while Opel’s deliveries also slumped 25% year-over-year. Consumer confidence in big-ticket purchases has been severely impacted by the economy’s slowdown, combined with a depreciation of the local currency. Political tensions surrounding Ukraine have also added unrest among the population.

Via Automotive News Europe