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New Car Sales Freefall in Russia

New programs expected to slow rate of descent.

by on Apr.09, 2015

AvtoVAZ Lada brand is one of the best-sellers in a weak Russian auto market.

In a stark contrast to auto sales in the U.S., which are heating up, new car sales in Russia have been dropping like a stone with no expected end to the fall in sight.

The light vehicle market posted its biggest monthly decline in Russia in about five years in March when it slid 42.5%, according to the Association of European Business. Through the first quarter of 2015, sales in the country are down 36.3% compared with year-ago figures.

Global Insight!

When examining automaker results, seeing what company performed best is a matter of which company lost the least, which in the case of March was Mercedes-Benz at 3%. AvtoVAZ’s Lada brand shrank 26% last month, Hyundai had the best month, falling just 15%. Kia lost 32% and Volkswagen fell 47%. (more…)

Ford Lands Big Deal in Russia – at Fiat’s Expense

Deal with Sollers could be major boost as former Soviet heartland's car market rebounds.

by on Feb.18, 2011

Sollers says "Da," to Ford, opening the door to an expanded presence in Russia.

Eager to expand sales in emerging markets, Ford Motor Co. has announced a 50/50 joint venture with Sollers, one of Russia’s leading automotive companies.

New of the proposed deal — which will involve the production and distribution of Ford passenger cars and light-duty commercial vehicles – followed shortly after Sollers announced it would not complete a partnership under negotiations with the Italian automaker, Fiat SpA.

“We are delighted to be taking this next step for Ford, in Russia, with our proposed partner, Sollers,” said Stephen Odell, chairman and CEO, Ford of Europe.

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“This is a great opportunity, and will provide Ford customers in Russia with more products and better service,” said Odell, adding “It also will help to strengthen the Russian automotive industry and its local supply base.”

In 2002, Ford became the first foreign auto manufacturer to start producing cars in Russia, and since then it has built a solid base in the country. But the joint venture with Sollers reflects a broader industry trend.


Rubles for Clunkers

Russia struggles to revive its own auto market.

by on Mar.10, 2010

Sales have been slow at showrooms, like Moscow's Major mega-dealer, with a quick turnaround considered unlikely.

What was once among the world’s fastest-growing car markets has struggled to avert disaster in recent months.  Now, Russian authorities hope to turn things around by borrowing an idea that’s worked in a number of other markets, including the U.S., throwing money at it.

The Russian version dwarfs America’s Cash for Clunkers program, however, and could eventually involve the investment of $20 billion over a 10-year period, with an initial $6 billion meant to yank the market out of its deep recession.

As in the U.S., that money will be used to stilulate demand for new vehicles – which plunged 49% last year – and to get off the road as many of Russia’s smoke-belching Ladas and Vazs as possible.  But some of the money will also be used to train workers and to prop up the struggling home automaker, AvtoVaz, which still holds a 30% share of the market.

Global News!

“Our end goal is to build a modern auto industry in Russia, including the entire production chain — from the steel sheet to the end product,” Prime Minister Vladimir Putin said, in a statement quoted by the Detroit Free Press.