Several Western car manufacturers are planning to double sales in Russia this year, hoping to make a deeper impression in a market dominated by cheaper, locally produced, vehicles.
French automaker Renault anticipates Russian consumers will buy 5,000 cars this year, almost twice the 3002 sold in 1999.
Sweden’s Volvo also hopes to boost sales by 50 per cent to 1,400 with its new S60 sports sedan. And Volkswagen, Europe’s largest auto manufacturer, is hoping for a 10 per cent rise in sales, having registered a decrease of 201 units to 3,078 last year.
VW spokesman Andrei Gordasevich said that the company will order 10 percent more cars than last year, which is “directly related to the growing consumer power in the market.”
Foreign vehicles make up barely a third of the country’s car market and of that total, new cars amount to less than 10 per cent. The rest are illegal imports or used.
Import taxes on new cars make them expensive in comparison to either domestic vehicles or second-hand imports. As a consequence, foreign carmakers have little chance of becoming major players on the market unless they slash costs by launching local production.
General Motors has joined forces with AvtoVAZ to produce the Niva 2123 sports utility vehicle (SUV) with Chevrolet badges, while Renault has formed a joint venture with Moskvich to locally assemble the Megane.