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.

If you liked the article, share on:

Topics: europe, russia

Comments

Recommended

Before the W177 goes on sale in 2018, Mercedes-Benz had to go back to the drawing board to check on the A Class’ interior. This is because the new model...
by - November 24, 2017
If you see the Aston Martin’s 2018 Vantage, you would think that it is significantly different from most of Aston’s GT lineup. For instance, if the DB11 is a fine...
by - November 24, 2017
Even as Chevrolet is making a huge splash in the industry with the recent launch of the new Corvette ZR1, there may be trouble brewing. Chevrolet has announced huge discounts...
by - November 24, 2017
The 2018 GMC Sierra 2500HD has arrived this week at the snowy mountains in Colorado for its winter long debut. GMC’s tracked Sierra Mountain Concept will be on display at...
by - November 24, 2017
We’re willing to bet that the Bentley Bentayga is not the first thing that comes to mind for most people who are into off-roading and outdoor activities. It just doesn’t...
by - November 23, 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