Russia to Become Fifth Largest Auto Market in the World by End of Decade image

Analysts predict Russia will become the fifth largest auto market in the world by the end of the decade.

Global firm Boston Consulting Group released a report according to which auto market in Russia, which currently reached 2.9 million sales per year, will increase at an annual rate of 6% by the end of the decade, surpassing 4.4 million annually.

After it took the 10th place in 2009, Russia has now climbed on the 7th place, but with the government’s help in the following years it is seen reaching the 5th position. The Russian government will implement programs aimed at encouraging customers to purchase vehicles. Automakers, including GM and Ford, have recently built plants in the country to manufacture vehicles locally.

The ranking of the largest auto markets by 2020 is China, the US, India, Brazil and Russia, according to the BCG report. By that time, Russia will surpass Germany and become the largest auto market in Europe, although some say this will happen in the next few years. Through 2020 automakers are expected to invest around $10 billion to expand and make upgrades in Europe.

Ford and its JV Ford Sollers has recently completed building its new plant in Russia and now plans to build an engine plant in the region, investing $274 million. GM is also investing $1 billion in the market to boost annual production capacity to 230,000 units from the current 100,000.

Source: The Detroit News