Year-on-year new car sales in Russia in July fell 58 per cent on 2008 levels, despite the government’s attempts to prop up the ailing car industry.
Data from the Moscow-based Association of European Businesses (AEB) showed Russian sales fell by 58 percent to 115,483 units last month and this followed a 56 per cent drop in June. Sales for the year to date were down 50 per cent on 2008 levels to 879,144 units.
Unlike most western European nations, Russia has not introduced a scrappage incentive scheme. It has assisted the industry by offering a subsidy to banks to lower the cost or new car loans.
David Thomas, chairman of the AEB's automobile manufacturers committee, said: “We hope the actions taken by the government will start to reverse this trend during the summer, but urge close monitoring of the situation to ensure the actions are taking effect.”
Car manufacturers have expanded rapidly into Russia in recent years and it had expected to be Europe’s largest market for new car sales in 2009. Sales have suffered in the global recession as customers have found it difficult to obtain credit in Russia.