Russian Scrapping Incentives Should Kick-start The Market
The Russian car market looks likely to resume its growth in 2010, helped by the government’s €250 million cash for clunkers subsidy, according to PriceWaterhouseCoopers’ Autofacts.
According to Autofacts, the scheme, which started this month, will provide for 200,000 new cars. Participants receive a voucher worth €1,200 if they own a vehicle more than 10 years old.
Russian car sales dived 50 per cent to 1.45 million in 2009, according to Deutsche Bank.
“Until recently, Russia was viewed by most auto industry observers as the next big market in Europe – possibly even bigger than Germany. Although it is true that Russia has strong potential for growth, the financial crisis has underlined many structural weaknesses that will likely impact the future trajectory of the market,” Autofacts said.
“It is interesting to note that 2009’s monthly sales volumes were relatively stable across the year at about 120,000. This suggest that a steady level of demand still exists, providing a strong base to build when the recovery ensues,” Autofacts said.
Autofacts didn’t say how much the market might recover by in 2010, or offer any long-term projections for sales.
Neil Winton – March 15, 2010