The Russian government’s subsidies for interest rates on car loans were used in only 2.9% of new car sales in April.
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The business daily Kommersant reported the slow start for the stimulus measure that was introduced last month, citing data provided by the Industry and Trade Ministry.
The report said that state banks VTB 24, Sberbank, and Rosselkhozbank approved about 4,000 applications for government-sponsored interest rate subsidies out of 11,800 applications received in April.
The loan subsidy scheme entitles purchasers to a subsidy of two thirds of the Central Bank refinancing rate for a loan taken out from 2009-2011 for certain domestically produced models priced up to 350,000 roubles. Foreign brand vehicles assembled in Russia – such as the Ford Focus – are also eligible.
Take-up looks low so far, but the scheme could become more significant later this year.
“There’s also talk of that 350,000 rouble upper limit on eligibility being raised,” JD Power CEE analyst Carol Thomas told just-auto.
“That could bring in many more vehicles and help to stimulate the market further. We should get a decision on that within the next few weeks.”
See also: RUSSIA: Sales slide further, but there is some optimism [includes data]
