Russia to become Europe’s largest auto market by 2014

Article by Christian A., on October 22, 2010

Russia’s Industry and Trade Minister Viktor Khristenko said earlier this week that by 2014, the country will become the largest auto market in Europe as economic recovery boosts sales.

In a government question and answer session, Khristenko told legislators that the market would return to pre-crisis volumes by mid-2013 and that in 2014, it will be the “number one market in Europe, with more than 3 million cars sold."

The Ministry anticipates car production to hit 1.3 million units in 2010, while sales are expected to surpass 1.7 million vehicles.

Analysts made a prediction two years ago that Russia will become Europe's largest car market by 2010. Notably, the forecast was made before the global financial crisis happened. The crisis had wiped out two years of rapid growth.

Last Wednesday, Russian lawmakers raised planned expenditure on roads and highway construction projects by 26% in order to increase car purchases.

According to the Association of European Businesses, new light-commercial-vehicle and car sales increased by 55% to 185,953 units in September compared with the previous year. For the first nine months of the year, sales of new cars and light commercial vehicles in Russia increased by 18% to 1.32 million units compared to the same period in 2009.

In July, car sales rose by 50% year on year, as a government-sponsored "cash for clunkers" program boosted the demand for AvtoVAZ vehicles, making Russia the third-largest auto market in Europe. Last Monday, Prime Minister Vladimir Putin told foreign investors that Russia's economy will increase by 4% in 2010, after last year's 7.9% drop.

Several foreign automakers, such as Nissan and Chevrolet, already have announced plans to introduce more shifts at their Russian facilities to raise the output.

Chevrolet intends to produce a total of 37,000 vehicles this year, compared with 23,000 cars the previous year. The Automobile Manufacturers Committee of AEB made a prediction last month that there will be sales of 1.8 million vehicles in Russia this year. [via autonews - sub. required]

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