Sales of new cars in Russia dropped 26 percent in August to 172,015 new cars and light commercial vehicles, according to the Association of European Businesses (AEB) lobby group said. Sales of new cars in Russia also fell 12 percent in the first eight months of 2014 as the country’s weak economy gets aggravated by Western sanctions over a conflict in Ukraine as well as by people delaying large purchases.
Joerg Schreiber, chairman of the AEB automobile manufacturers committee, remarked in a statement that weak August sales hardly surprised anyone in the auto industry. The sales decline so far in Russia is in line with AEB’s forecast for the full year 2014.
Schreiber quipped that a recently announced scrappage and trade-in program by the Russian government has brought hope that the current decline in the auto market could be brought to a halt.
He noted that a halt in the car sales drop would depend on how quickly the program would become effective, to allow market participants to make use of it.
In August, the Russia announce it would allocate RUB10 billion to finance incentives for new vehicle purchases this year – in effect resurrecting a program that had helped the auto industry during the previous crisis.