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March 5, 2010

RUSSIA: AvtoVAZ sales fall as customers await scrappage scheme

AvtoVAZ, Russia’s biggest carmaker, saw domestic car sales fall 31% year on year in February, according to business daily Vedomosti.

AvtoVAZ , Russia’s biggest carmaker, saw domestic car sales fall 31% year on year in February, according to business daily Vedomosti .

The company, 25% owned by Renault , sold around 20,000 vehicles during last month according to spokesman Igor Burenkov. This compares with 29,000 units in the same month a year ago and follows a drop of 41% in January to 17,308 cars, according to the Association of European Businesses.

AvtoVAZ said customers were holding back and waiting for the Russian government’s scrappage programme which is expected to start on Monday. Under the program, owners of cars produced in 1999 or earlier can receive bonuses worth RUB50,000 (US$1,650) to buy new Russian-manufactured cars in exchange for recycling their old vehicles.

AvtoVAZ recently announced a special offer, under which the price for basic Lada 2105 cars will beRUB99,000 ($3,300) under the programme while the Kalina will cost RUB199,000 ($6,500).

Dealers have already taken 20,000 orders from potential Lada buyers under the programme, according to the company which plans to sell 100,000 cars through the scheme.

AvtoVAZ has previously said it planned to sell about 400,000 cars in Russia in 2010 with a further 50,000 earmarked for export. It also recently announced plans to increase production more than 55% month on month to 38,200 vehicles in March.

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