Luxury manufacturers are bracing themselves for a predicted 60 per cent drop in Russian car sales.
Russia had been set to overtake Germany as Europe’s largest car market and premium manufacturers such as Jaguar Land Rover see it as important sales territory.
However, since the financial crisis hit in mid-2008, around 3.5 million Russians have reportedly lost their jobs and fewer consumers can afford expensive purchases.
Deputy trade and industry minister Andrei Dementyev told Russian news network Interfax that it will be a difficult year ahead for the industry.
“We thought in December that the car market might shrink 40 per cent (during 2009)," he said, "but analysis of sales in the first quarter indicates that the drop could be 60 per cent compared with last year.”
Despite this news, Tata-owned Jaguar Land Rover remains positive and still regards Russia as a key market.
“Whilst Russia has suffered in recent months, it has done so along with the rest of the world’s economies,” said JLR spokesman Don Hume.
“Our position is that the situation is stabilised and we foresee a secure decline. Russia, China and India are still important opportunities for us,” he added.