Russia’s Association of European Businesses (AEB) is scrambling to generate a positive spin on last month’s passenger cars and LCV sales, which saw numbers fall yet again, this time by 18%.
The data is the latest in a long list of gloomy sales figures to hit the Russian auto sector as consumers prefer to keep their roubles firmly in their pockets and not in showrooms and as the usual raft of headwinds such as international economic sanctions, low oil prices and high credit rates continue to afflict the market.
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August 2016 sales of new cars and LCVs decreased by 18% compared to last year or by 24,969 sold units, amounting to 113,749 vehicles according to the AEB Automobile Manufacturers Committee (AEB AMC).
The year January—August, 895,357 cars were sold.
“August was unable to break the downward trend in year-on-year sales dynamics we have seen in recent months,” said AEB AMC chairman, Joerg Schreiber.
“We need to bear in mind however that last year’s volume base was propped up by currency fluctuations prompting customers to pull ahead the purchase of their car.
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By GlobalData“This did not happen this year – bad for the current month statistics but a good thing for sales in the coming months as customer demand won’t be distorted by this factor.
“Another piece of good news is that, for the time being, total market sales have stopped to undercut the former historical low levels reached in 2009. Chances are strong that this story will continue in September.”
Despite the downbeat assessment, there is some light on the horizon as oil prices have at least stabilised in the mid-US$40 range, rather than languishing far below that earlier this year.
Analysts estimate in order for the Russian economy to establish a sound foundation for recovery, oil needs to reach at least US$48 per barrel to replenish depleted Kremlin coffers.
