Russia is the one automotive market defying gravity, they said. It's riding high on the wave of a domestic economy feeling the fruits of a global energy and raw materials based boom. Real incomes are soaring and automakers have claimed, until recently, that they cannot buid enough cars to meet demand.

But energy and raw material prices have recently fallen and there are signs that Russia's automotive market is cooling rapidly.

Moreover, Russia is not immune to developments in international financial markets. Its own money markets are now being impacted.

The Russian Duma, or lower house of Parliament, this week approved a financial sector bailout package valued at more than USD80bn. And trading on Russian stock exchanges was suspended until further notice after sharp falls in prices.

Sources have told just-auto that credit available for car purchase in Russia has dramatically dried up in Russia over the past week. Automakers and dealers are bracing for a reversal in demand after a prolonged period of growth.

Russia's biggest steelmaker, Severstal has also announced sweeping output cuts for October as economic conditions hit demand for steel products.

The company said on Friday it would cut crude steel output at its Cherepovets plant in Russia by approximately 25 %.

"We consider these measures to be prudent management in a time of rapidly changing market conditions," Sergei Kuznetsov, Severstal's CFO, said in a statement.

Severstal is also reviewing its 2008 full-year production plans, it said.

UK: Russia's car market slows