The car sales trend keeps going down in Russia, and as January reports show a steeper decline than analysts have predicted.
The Russian automotive market started the year on the same downfall trend, mind a decline that pushed the industry last year to the lowest level since the country’s previous recession in 2009. After a 46 percent plunge in December, cheap January 2016 sales of new cars and light commercial vehicles in Russia decreased by a further 29.1 percent compared to the same period over a year earlier, or by 33,615 units. The auto market totaled 81,849 cars sold last month, according to data released by the Association of European Businesses. “Not the best start in to a year which all experts agree will show a negative sales trend again. Most forecasts including our own however see the full year at a better trend than shown in January,” Joerg Schreiber, Chairman of the AEB Automobile Manufacturers Committee stated.
AEB expectations remains on the negative side for this year, however at a less pronounced pace than seen in the whole of 2015. “The recently announced extension of the government support to the automotive sector in the first half of 2016 is a positive step in this direction,” Schreiber added. “On the other hand, the continuing price inflation fueled by a very weak currency will remain a major challenge on the long way to market recovery.” Demand for cars will probably decline another 4.7 percent this year after a 36 percent drop in 2015, the Schreiber forecasted last month. In its efforts to stop the plunge, the Russian government agreed last month with a plan to provide 50 billion rubles (around 650 million dollars) in subsidies to the country’s troubled car industry.