Russian car sales soared 77% percent in March with a trade group saying on Friday it would need to raise its full-year forecast if the economy continues to benefit from high oil prices.
The economy of the world’s top oil exporter is firmly in the recovery phase after its worst recession in 15 years, and consumers are starting to feel rich enough to buy large-ticket items such as cars again, Reuters noted. In the first quarter, some 517,304 cars were sold in Russia, up from 292,437 in the same period of 2010, it said, citing the Association of European Businesses.
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“This puts down a strong foundation for growth in the rest of 2011 and for the development of the Russian car market back towards its pre-crisis level,” David Thomas, chairman of the AEB Automobile Manufacturers Committee, was quoted as saying.
“The official AEB Consensus forecast for the full year remained at 2.24m in March but we will review with our members during April and I expect that our official forecast will then increase.”
Before the recession hit in late 2008, Russia had been on track to overtake Germany as Europe’s biggest car market and the AEB has previously said annual sales could return to pre-crisis levels of 2.8m to 2.9m units in 2012, the report said.
In March alone, sales totalled 223,429 units, led by Avtovaz’s Lada brand.
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By GlobalDataIn future months, sales growth is expected to slow down in year-on-year terms, reflecting the fact that in March 2010 Russia introduced a car scrappage scheme, boosting sales by giving drivers RUB50,000 (US$1,771) for trading in models more than 10 years old for new domestically-manufactured cars.
The scheme was set to expire this month but prime minister Vladimir Putin said this week it would be extended until the end of the year, pledging an extra RUB5bn of budget cash.
“Looking forward, the year on year increases will lessen reflecting the inclusion of scrappage sales in the corresponding base period for 2010, but provided that oil prices remain high and the economic recovery continues, we remain confident for the balance of the year and 2012,” said Mark Ovenden, vice-chairman of the AEB Automobile Manufacturers Committee.
