Cars, Machinery

AEB: automotive market will grow by 4.1% in 2017 year

AEB Automobile Manufactures Committe. Results of 2016 and forecast of 2017 year. Jörg Schreiber

Automobile Manufacturers Committee of the Association of European Businesses (AEB) is expecting the end of a 4-year period of the fall in 2017 and expects “moderate” growth of the Russian car market at the level of 4.1% compared to 2016 – up to 1.48 million cars and light commercial vehicles. It was stated by the head of the Automobile Manufacturers Committee Jörg Schreiber at a press conference in the AEB on January 12, 2017. The committee represents 98% of cars sales volume in Russia, 46 brands.

1’425’791 (-11% YoY) new cars were sold in Russia in 2016 year. These figures correspond to the June forecast of AEB. Russia is the fifth largest European car market by sales volume, giving way to Germany, UK, France and Italy, and the only one market where sales are falling.

Sales drop was expected as a result of decrease in consumer demand and consumer confidence on the market where more than 80% of sales are made to private persons and not to corporate customers. “Automakers earned very modest in recent years”, – said J. Schreiber. In 2017 these indexes demonstrate signs of growth, what gives hope for a slight increase in sales during this year. Another component of the positive outlook was the expectation of the effectiveness of new car market support programs, which were launched by the state in 2017.

According to Jörg Schreiber, development trends of 2015 and 2016 will continue in this year. It comes primarily about the preservation of the high share of locally produced cars (in January-November 2016 – 74.8%), a decrease in the share of sales in the center in favor of the regions, as well as the trend of segments’ development.

The largest relative growth showed sales of small SUVs (+50.4%) in January-November 2016. SUVs in general have increased the share of sales by 2.4% and amounted to 36.2% of the total volume of new cars sold in Russia. The most significant drop in the share observed in the sales leader – compact passenger vehicles (-5.3% to 29.1% of sales).

The most selling brands were Lada (266’296 vehicles, -1%), Kia (149’567, -9%) and Hyundai (145’254, -10%) in Russia in 2016. Best selling car models of the domestic market – low cost Hyundai Solaris (90’380 units), Lada Granta (87’726) and Kia Rio (87’662).

Source: Association of European Businesses