Car sales in Russia posted a flat growth in March, indicating some stabilization following declines of 6 percent in January and 2 percent in February. According to the Association of European Businesses (AEB) lobby group, sales of cars and light commercial vehicles in March 2014 were 243,335 units, compared with 244,225 in the same month in 2013.
For the first three months of 2014, car sales in the country dropped 2 percent to 602 523 units. Lada and Renault – the No. 1 and No. 2 brands in Russia – both posted an 8-percent fall in sales in March. In contrast, No. 3 Nissan logged a 20-percent jump in sales in the month. The slowing Russian economy has led people to delay large purchases like vehicles.
Sales dropped 6 percent in full year 2013 and are expected to remain weak this year. According to AEB, the smaller decline in February was an indication that a weakening ruble was encouraging consumers to make orders. The ruble has dropped 8 percent so far this year.
AEB Automobile Manufacturers Committee Chairman Joerg Schreiber said in a statement that rate of decline had been less pronounced in recent months, indicating that consolidation is “around the corner." He said that the prevailing thinking among market participants is that the recent increase in market demand was boosted by one-time effects that will have a reverse impact on customer activity in the second quarter.
He noted that the order banks generated during the surge should contribute to an improving performance of the retail industry in the next few months. Ford’s joint venture with and Russian carmaker Sollers, Ford Sollers, recently announced it would cut output and 950 jobs at two of its three sites in the country.
On the other hand, Renault-Nissan chief executive Carlos Ghosn said he is still bullish on Russia due to long-term factors like a rising middle class, and dismissed any impact of the current row between the country and the West.