Carmakers see Europe growth this year, but are wary of Russia

Article by Christian A., on March 5, 2015

Carmakers are finally seeing growth in Europe after years of slump, but remain cautious of the possible effect of the current situation in the Russian auto market. Opel chief executive Karl-Thomas Neumann quipped that Russian market – which used to be General Motors’ third largest in Europe -- is down and the carmaker plans to temporarily shut down its St. Petersburg site for eight weeks starting late March and into May.

GM has already trimmed output at the facility from two shift s in September 2014 to just one, as its Opel and Chevrolet units suffered from a huge drop in demand in Russia and from the depreciating ruble. Neumaan remarked during an event hosted by the Vauxhall brand that GM doesn’t think the situation in Europe will fundamentally change.

He noted that while there are European markets that are growing, there are other those that are “hugely disappointing,” citing the Russian market. On the other hand, Volkswagen top honcho Martin Winterkorn said that while he was optimistic about the growth prospects in Western Europe, the situation in Russia has rendered “made forecasting as a whole difficult.

Industry forecasting group IHS Automotive remarked that light-vehicle sales in Russia dropped 24 percent in January 2015 to 115,390 while sales for the full year are expected to plunge 27 percent to 1.81 million. Greatly affecting auto sales in Russia is the continued devaluation of the ruble, which lost around half its value against the US dollar in the past year.

This has forced carmaker to hike prices of new cars in Russia by 13 percent on average, Nissan Europe Senior Vice President of Sales Guillaume Cartier told Automotive News Europe. Cartier disclosed that the Japanese carmaker had increased its prices by 20 percent in Russia since the start of 2015.

Volvo's board member for sales Alain Visser, meanwhile, divulged to ANE that the Swedish carmaker has hiked prices of its new car by more than 20 percent in Russia.

Both Cartier and Visser quipped that their companies have no plans to withdraw from Russia despite posting double-digit sales drops in in January as the country has a great potential to grow again.

Topics: europe, russia

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Cadillac’s CT6 full-size prestige-luxury sedan is still somewhat new. It has been offered to the global auto market for two model years – 2016 and 2017. But for those who...
by - February 19, 2017
In many industries, it is the rivalries that make things exciting. In basketball for example, there is the well-known rivalry between the Los Angeles Lakers against the Boston Celtics. For...
by - February 19, 2017
Now on sale in several major markets around the world including Europe, the BMW 5 Series (G30) heralds the arrival of the new seventh generation and represents a whole new...
by - February 19, 2017
Just recently, it was speculated that a new Porsche Cayman GT4 RS is coming. There is no official confirmation yet from the German sports car maker, but the arrival of...
by - February 18, 2017
Will there be a BMW M4 CS? Apparently, there is a Club Sport version of the BMWM4 after it was sighted in California doing a shoot for a new commercial...
by - February 18, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries